Anders Elowsson on Warpcast

Content pfp

https://ethereum.org

0 reply

0 recast

0 reaction

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

Q&A 🧵 on EIP-7918 This thread summarizes my responses on Ethereum Magicians to four questions from @dataalways concerning: the coupling of fee markets, alternative designs, a comparison with EIP-7762, and the empirical impact of a price floor for blobs. Let’s dig in 👇

1 reply

1 recast

13 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

Question 1: concerns the coupling of fee markets that EIP-7918 introduces. Is this something we want? The answer is yes! The price of blobspace depends on the price of execution gas, and this should be reflected in the fee market. https://ethereum-magicians.org/t/eip-7918-blob-base-fee-bounded-by-execution-cost/23271/4#p-56700-question-1-coupling-of-fee-markets-1

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

Currently, the mechanism behaves as follows: * Users purchase blobspace by spending execution gas and blob gas. * The blob gas fee update mechanism is unaware of the cost of execution gas, and thus unaware of the total cost of blobspace. * A relatively high cost of execution gas renders changes to the blob gas fee subordinate in determining quantity demanded. * The mechanism fails to timely converge on equilibrium whenever the cost of execution gas dominates the cost of blob gas.

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

In essence: the current mechanism behaves as if it controlled the price of blobspace, when it only controls the price of blob gas. It increases the price of blobspace in minuscule 0.00001% steps to attain equilibrium—because that’s a 10% increase in the blob base fee.

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

EIP-7918 resolves this by adjusting the fee mechanism when execution gas costs dominate. The two fee markets remain fully independent within the operational range where the blob base fee carries the price signal.

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

Question 2: asks if there are alternative parameter settings and designs? A nice thing about EIP-7918 is its minimalist nature. It activates once the cost of the cheapest tx exceeds the cost of target blobs.

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

That’s when execution costs dominate for all blob consumers. It would be possible to alternatively amortize across max blobs, or across the square root of target/max blobs, but target blobs is a neutral and viable solution.

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

There is also one other option on the same theme, which I call a composite fee market. It is a larger conceptual change and would have to be part of a potential future harmonization of fee markets. It can however be interesting to review to also understand EIP-7918.

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

Composite fee market The composite fee market updates the blob base fee based on the *real* demand function for blobspace: Q(b + c), where Q is quantity demanded, b is the blob base fee, and c is the amortized tx cost expressed per blob gas. Say the desired shift q to the price of blobspace is ±12.5%. The blob base fee is then updated from block 0 to 1 by: b₁ = b₀ + q(b₀ + c₀) To the user who employs the same execution gas per blob gas as in c₀, the maximal change in the cost of blobspace per slot would still be 12.5%. The proportional change in b can however be dramatic whenever b << c. This is as intended—it allows the composite fee auction to quickly converge on equilibrium, no longer “getting stuck” at lower blob base fees.

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

Question 3: is a request for a comparison with EIP-7762. Both EIPs reference the cost of execution gas. EIP-7762 hard-codes a price floor to work under current circumstances. EIP-7918 makes the floor dynamically vary with the cost of execution gas. https://ethereum-magicians.org/t/eip-7918-blob-base-fee-bounded-by-execution-cost/23271/4#p-56700-question-3-comparison-with-eip-7762-4

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

While the fixed floor of EIP-7762 might make it easier to justify tuning the floor to achieve desired outcomes going forward, it is possible to argue that this is rather a drawback. A self-adjusting dynamic floor is a neat ideal to strive towards.

1 reply

0 recast

2 reactions

Anders Elowsson pfp

Anders Elowsson

@anderselowsson

EIP-7918 also accounts for future scaling. The cost of (providing) 128 kB of DA will fall drastically over the next 50 years due to improvements in hardware and software. EIP-7918 reduces the price floor when target blobs increases to reflect this.

1 reply

0 recast

2 reactions