The Economic Security of Exponential EIP-1559

2026-10-07

AI Summary

This study addresses the lack of economic security guarantees in EIP-1559 fee mechanism parameter selection and its susceptibility to excessive blockchain state growth. For the first time, this work formally defines and implements the economic security of this mechanism. Methodologically, it establishes theoretical lower bounds for parameter configuration by constructing minimum-revenue distributions, and integrates game-theoretic and optimization analyses to derive optimal parameter strategies across diverse on-chain mechanisms. The research provides provably secure parameter configurations for Ethereum and variants such as Arbitrum, ensuring minimum fee revenue under high network loads to deter abuse. Ultimately, this approach effectively balances system efficiency with long-term security.

Abstract

We consider the problem of parameter selection for EIP-1559, a widely used gas pricing mechanism for blockchains. As opposed to previous work, we aim to achieve economic security, where the chosen parameters guarantee a lower bound on total collected gas fees whenever usage over a given time window exceeds a specified threshold. This bound can be set prohibitively high, thereby economically deterring usage above a desired level. Such guarantees are particularly relevant to long-term objectives such as limiting state growth. We apply our approach to the pure exponential version of EIP-1559 which Ethereum uses and to a variant used by Robinhood Chain and Arbitrum. To achieve economic security, we first characterize the revenue-minimizing gas-usage distribution for the exponential version and for the other variant we construct a distribution whose associated fee revenue provably approximates the minimum. Using these results, we then demonstrate how to set economically secure mechanism parameters for both variants and we discuss the associated tradeoffs.

Problem

• EIP-1559
• gas pricing mechanism
• parameter selection
• economic security
• blockchain

Innovation

• EIP-1559
• Economic Security
• Gas Pricing Mechanism
• Revenue-Minimizing Distribution
• Exponential Pricing