EIP-1559: Fee Market Change for ETH 1.0 Chain
Vitalik Buterin, Eric Conner, Rick Dudley, Matthew Slipper, Ian Norden, Abdelhamid Bakhta
Abstract
EIP-1559 proposes a significant revision to Ethereum's fee market structure, aiming to improve user experience and transaction fee predictability. Instead of a simple first-price auction where users bid arbitrary amounts for transaction inclusion, EIP-1559 introduces a base fee mechanism that is algorithmically adjusted based on network congestion. This base fee is burned, removing it from circulation, and users can then include an optional tip to incentivize miners to prioritize their transactions. The protocol dynamically adjusts the block size, expanding when fees are low and contracting when they are high, within a target block size. This aims to smooth out fee volatility and provide a more predictable fee environment for users, while the burning mechanism introduces a deflationary pressure on ETH. The proposal was developed to address issues of unpredictable gas prices and to create a more robust fee market for the Ethereum network.
Key Findings
- 1EIP-1559 introduces a base fee that is burned, which can have a deflationary effect on ETH.
- 2The protocol dynamically adjusts block size to manage network congestion and fee predictability.
- 3Transaction fees become more predictable by moving away from a pure gas auction to a base fee plus optional tip.
- 4This change aims to improve the user experience for interacting with the Ethereum network.
Topics
Citation
BibTeX
@misc{eip15592019,
title = {EIP-1559: Fee Market Change for ETH 1.0 Chain},
author = {Vitalik Buterin and Eric Conner and Rick Dudley and Matthew Slipper and Ian Norden and Abdelhamid Bakhta},
year = {2019},
howpublished = {\url{https://eips.ethereum.org/EIPS/eip-1559}},
}Knowledge Explorer
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