EIP-1559: Tackling the Gas Fee Problem on Ethereum
- Tim Roughgardenš¯•¸
Ethereum Improvement Proposal (EIP)-1559 is a proposal to make several tightly coupled additions to Ethereumā€™s transaction fee mechanism. Central to the design is a base fee, which plays the role of a reserve price and is meant to match supply and demand. Every transaction included in a block must pay that blockā€™s base fee (per unit of gas), and this payment is burnt rather than transferred to the blockā€™s miner. The base fee is adjusted after every block, with larger-than-target blocks increasing it and smaller-than-target blocks decreasing it. Tim Roughgarden is a Professor of Computer Science and member of the Data Science Institute at Columbia University. Tim did an extensive game theoretical review of EIP-1559 and joined us to chat about what the proposal is trying to do and why, and how it is doing it.
Topics:
- What Tim's research focuses on and how he became involved with blockchain
- What made him interested in the fees problem
- The current fee system on Ethereum - the first-price auction and base fee
- EIP-1559 - the problem it solves and how it does it
- Increasing and decreasing of block sizes
- The threat of miners colluding to drive down base fees
- Deep dive into how the proposal works
- What are some alternatives to EIP-1559