Empirical Analysis of EIP-1559
- Yuxuan Lu, Turing Class
- Time: 2022-04-15 18:00
- Host: Turing Class Research Committee
- Venue: Room 101, Courtyard No.5, Jingyuan+Online Talk
Transaction fee mechanism (TFM) is an essential component of a blockchain protocol. However, a systematic evaluation of the real-world impact of TFMs is still absent. Using rich data from the Ethereum blockchain, mempool, and exchanges, we study the effect of EIP-1559, one of the first deployed TFMs that depart from the traditional first-price auction paradigm. We conduct a rigorous and comprehensive empirical study to examine its causal effect on blockchain transaction fee dynamics, transaction waiting time, and security. Our results show that EIP-1559 improves the user experience by making fee estimation easier, mitigating intra-block difference of gas price paid, and reducing users' waiting times. However, EIP-1559 has only a small effect on gas fee levels and consensus security. In addition, we found that when Ether's price is more volatile, the waiting time is significantly higher. We also verify that a larger block size increases the presence of siblings. These findings suggest new directions for improving TFM.
Yuxuan Lu is a senior undergraduate in Turing Class, Peking University. His research interests lie Blockchain, cryptography and information elicitation.
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