EIP 1559 proposes a new mechanism in which the base fee is adjusted by the protocol to target an average gas usage per block instead of an absolute gas usage per block. See the EIP-1559 page for more details and EIP-2593 for another proposal. The foundation believes that the Ethereum transaction price mechanism is an important issue facing the Ethereum community, including in ETH2. The technique chosen will be analyzed by users, miners, attackers, and other blockchains.
Tim is Professor of Computer Science at Columbia University, and is a leading algorithmic game theorist. He has been awarded the ACM Grace Murray Hopper Award, the Gödel Prize, and many other awards. We are very grateful that he is willing to work on the Ethereum transaction price mechanism. Here is a quote from Tim:
The proposed research will provide an analysis of proposed changes to the transaction fee mechanism in the Ethereum protocol, including: (i) a formal definition of the design space, including the proposals in EIP-1559 and EIP-2593; (ii) a formal definition of the objectives and constraints; (iii) a formal model of transactions; (iv) a formal game-theoretic model for miners; (v) the identification of formal trade-offs between the competing objectives; (vi) if possible, the identification of an “optimal” mechanism.
Tim will produce a progress report halfway through the work and a final report that will be made publicly available on arXiv. Any software produced will be made publicly available. The agreement includes 45 hours of communication with the Ethereum community, including relevant chat and discussion forums.
The foundation is excited for this work, and can’t wait to see what results!