Head of research @blockspace_eth | @blockspaceforum | fmr. head of research @ChorusOne | block building enthusiast
Switzerland
Joined September 2022
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Excited to announce that I've been leading research at Blockspace for multiple months now.
More than 90% of blocks are constructed out-of-protocol. Improving this process will benefit Ethereum, originators, validators, builders...
When Ethereum and ETH win, Blockspace wins.
Expect tangible improvements within weeks.
Payload Sharing is a new win<>win addition to multi-party block construction.
This allows multiple operators to propagate the block signed by the proposer together.
As a result, blocks reach the network more reliably.
Reducing delivery risk benefits Ethereum users, validators, builders..
Multi-party block construction may be the "best chart in crypto".
Now at 13.4% of blocks over the last 24h and closing in on 500k included user transactions.
Out-of-protocol has much to give to Ethereum and users.
This is especially true as in-protocol shifts to addressing PQ.
My rather detailed take on validator bid selection follows.
Validators can select:
- Latest bid, which allows builders to cancel older bids.
- Highest bid, which does not allow that.
Selecting the latest bid is likely more profitable longer-term.
When validators select the highest bid, traders are exposed to additional risks which they have to price into their transactions.
Let's unpack it:
The block auction can end at any time. The bid at time t is right at that time t.
If there is a risk that this old bid gets taken at t+1 then that is a distinct risk factor.
If I’m a trader and I know my bid only gets taken when I submit it then I have to price some risks, mainly market risk.
If I know that it can also get taken later, then I have to add a new risk term for this distinct adverse selection risk.
Because of this distinct new risk, my bid is lower in expectation.
Because the exposure window is unknown, I can’t price the risk properly so I add a margin on top of the expected loss which means that EV goes down.
This affects small proposers especially because of their varying setups.
This risk can also surface in other ways.
Let’s say instead of pricing lower, I want to avoid adverse selection by just submitting a single bid.
This means I have to identify the exact moment at which the auction ends.
This varies with different proposer setups, to the disadvantage of small proposers especially.
As a result, delivery risk goes up (eg missed slot) and expected value goes down.
An analogy is an RFQ you get from multiple market makers.
This has an expiry time and if that expiry time is stretched and old quotes can get taken, then each quote will be worse to take that risk into account.
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Blockspace is one of the organizations that has stepped up to drive Ethereum forward.
Ethereum wins, we win.
We also continue to support and grow the Ethereum ecosystem.
On August 4, we announced a strategic investment in @BlockSpace_ETH. Blockspace’s team helped develop the systems that build most of Ethereum’s blocks, and it’s now making them faster and more reliable.
It adds to our support for @ethlabs_org, @ethereuminsti and @eth_systems, which work on Ethereum's core protocol, institutional adoption and privacy.
Participated in workshops on Frame Transactions (EIP-8141) last week.
Great EIP. More flexibility for users is great.
Most excited about support for different concurrent signing methods, e.g. different cryptography. Really key for PQ.
Frame Transactions have new requirements. For example, they can be very large.
For this reason I see much overlap with multi-party block construction.
MPBC frequently adds a lot of gas to blocks, including transactions and blobs.
For example, just today a block with +44.8m gas landed. Multiple blocks exceeding 20m gas added also landed.
I think frame transactions can be great for users, and MPBC is a very efficient way of getting them included.
Looking forward to that.
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Some Devcon takeaways:
- While I enjoyed visiting India, the location did limit attendance from the Americas in particular.
- Security and specifically PQ is the absolute focus and will determine the roadmap now and until solved.
- 10%+ Ethereum blocks are multi-party now. More people should know about this. This share will keep climbing.
- Frame transactions are a good, general solution and address many problems. A multi-sig using multiple types of cryptography is an example (PQ!)
- Bear market is clearly felt. However, I believe doubling down on the upside and neutral tech is very worthwhile.
- A lot of M&A activity. Often small, profitable teams getting acquired.
- Always good catching up with friends old and new.
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I’m particularly excited about the low latency variance Silver has.
This means that edge cases are consistently covered. It’s a sign of elegant engineering.
This risk reduction is a key requirement for larger blocks, such as multi-party blocks.
I hope other clients follow suit.
Fast inclusion matters more on some days than others.
More than 50% of value added to multi-party blocks came in over the last 24h.
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A little data puzzle from MPBC.
While total gas added to blocks appears roughly log-normally distributed with a fat right tail, blobs do not appear to follow a clear distribution.
Why is that?
Let's examine blobs in more detail:
The bucket containing 5-6 blobs is the largest, followed by the buckets containing 3 blobs and 1 blob.
The likely solution:
L2s typically post batches of blobs in fixed sizes that fit these large buckets.
These are then included through MPBC in one go.
For example, the standard OP batcher configuration recommends 6 blobs per TX, corresponding to the largest bucket in our data.
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Michael retweeted
When I wrote "Sharding the Builder" in 2022, my naive solution to builder centralization was multiple builders competing to each win a chunk (Near nightshade style) of the execution block. There would be three competitive MEV auctions per block enforcing a gas cap on each, along with one non-competitive censorship resistance chunk. The proposer would aggregate the winning chunks. This was a multi builder design with an inclusion list in it, written before the Merge.
Seeing the concept come to fruition over the years with contributions from many brilliant researchers, developers, operators, and teams is pretty sweet.
It was even sweeter to get to talk to @mostlyblocks about @Blockspace_ETH MPBC design and its growing adoption (Shout out to TOOL and BuilderNet as well!) We spent a good chunk of the episode going over the mechanism and dashboard including a few thought experiments. There is a ton of alpha in this episode if you listen carefully.
Sharding the Builder - my writing
mirror.xyz/0x8abcbb75A07d160…
Enjoyed the conversation with aPriori!
Wide-ranging from block construction basics, to data on MPBC, down to API details.
Improving Ethereum for users is a total win<>win.
Hope the episode sheds light on how MPBC contributes to this, and where it may go.
What FOCIL does is provide hard guarantees for the transactions the Ethereum protocol sees.
What Multi-Party Block Construction (MPBC) provides is softer fast inclusion guarantees for transactions that are known by any block builder.
Now you have multiple builders contributing to blocks. In particular, the base builder and the contributing builder work with the MPBC operator and proposer to deliver the most valuable block to the Ethereum network.
In the future, both FOCIL and MPBC can continue to scale up and get bigger together, making Ethereum more robust.
In the endgame it maybe that FOCIL includers construct most of the block, with the MPBC pipeline doing the rest. The builder role then becomes an "off-to-the-side function", simply adding a few transactions to capture MEV.
@mostlyblocks from @Blockspace_ETH touches on these topics and more as he eloquently provides a comprehensive first principles overview of MPBC on Ethereum in this quintessential episode of Credible Commitments.
Same reason Quick Slots are S-tier. Faster actions, more information equals better outcomes, larger pie.
Inclusion tracing gives the user a view into their path onchain. More transparent UX for monitoring inclusion!
Separately, I really like this "295 hours saved" statistic :) action produces information, pulling actions earlier means faster information, means faster action etc.
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MPBC is fast approaching 100k included user transactions.
Inclusion Tracing allows users to easily check how their transactions were handled.
Knowing a transaction's hash and the time it was sent is enough.
Outputs are specific without obscure language.
Making UX better and transparent is really key for Ethereum to succeed!
Stellar weekend for MPBC:
- On Saturday 5.35% of all Ethereum blocks were multi-party blocks.
- New all-time record blocks for highest value uplift , highest gas uplift, and blobs added.
More improvements coming shortly that will improve performance and UX further.
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Bid streams allow proposers to receive multiple fast bids per block.
This is a notable improvement on the round-trip request proposers currently send to get bids.
As a result bids are delivered more reliably, which means fewer missed slots & better blocks. It's "Kaizen"!
Today 3.5% of all Ethereum blocks are multi-party blocks.
This is up from around 2% when MPBC was announced.
The average number of builders per multi-party block is 2.63 today.
This is the highest to date, and up from the 2.42 previous high I mentioned last Friday.
There are also three new blocks by gas added on the all-time leaderboard.
This morning, Aestus delivered blocks adding up to 25.8m gas or an additional 1190%.
This came from contributions by the Bombora, BTCS, and Quasar builders.