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Soft preconfirmations

and other builder services

Alex Stokes

Researcher, EF

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Blockspace?

  • What goes into the blockchain

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  • Today, transactions, tomorrow …?

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  • Interface to the protocol’s resources
    • The “state”

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Value supports specialization

  • Blockspace is valuable to the extent that Ethereum’s state is valuable

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  • Value creation supports specialization
    • “Builder” role

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  • Builders specialize in refining blockspace into higher-value goods and services

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Better blockspace?

  • Sponsored transactions
    • Builder pays for gas
  • Instant confirmations
    • Builder promises to include your transaction
  • Cancellations, retries
    • Builder handles your transaction subject to some events (h/t @0xQuintus)
  • Gas futures
    • Builder sells blockspace in the future
    • … in the past? (h/t @hasufl)
  • “Account abstraction” a la EIP-4337
    • Builder offers more flexible schemes for protocol access
  • MEV
    • Extraction
    • Smoothing
    • Protection, rebates

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Better blockspace?

  • Sponsored transactions
    • Builder pays for gas
  • Instant confirmations
    • Builder promises to include your transaction
  • Cancellations, retries
    • Builder handles your transaction subject to some events (h/t @0xQuintus)
  • Gas futures
    • Builder sells blockspace in the future
    • … in the past? (h/t @hasufl)
  • “Account abstraction” a la EIP-4337
    • Builder offers more flexible schemes for protocol access
  • MEV
    • Extraction
    • Smoothing
    • Protection, rebates

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“Soft preconfirmations”

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Why do we need in the first place?

  • Permissionless nature means time from transaction creation to transaction inclusion

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  • Do not necessarily know the next node on the network who will place a block into the chain

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  • Complicated by other users competing for scarce resources
    • Need a mechanism (fee market) to allocate blockspace

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Block producers can provide certainty

  • If we know the block producer, then they can just tell us where in their stream of transactions ours lands

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  • L2: rollup sequencer
    • Send opDAI in block X at transaction index Y
  • L1: builder
    • Make Uniswap trade at top-of-block in block Z

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Decentralization?

  • Spectrum of decentralization in real world systems
    • Centralized sequencer
      • Send to a single RPC API
      • Most (all?) current rollups
    • Decentralized sequencer?
      • L1 is key example

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  • In centralized case, just make a persistent log
    • “Transaction journal”
    • Mature, production-ready technology to handle this case

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Decentralized sequencer: L1 example

  • Decentralized validator set
    • Also want to respect validator privacy
  • Discovery?
    • How to find next block producer? (protocol actively obscures it)
  • Inclusion?
    • In PBS context, are all proposers connected to all builders?
    • Do builders share transaction set?
      • “Builder cartel” (h/t @barnabemonnot)
  • Transaction privacy?
    • Am I ok w/ preconfirmation if it means I leak my MEV?
    • Encrypted mempool to mitigate?
  • Another allocation problem for “builder’s log”
    • Auction for preconfirmation?
    • How can I pay decentralized builder in incentive-compatible way?

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L1 preconfirmations: sketch of design

  • Assume out-of-protocol PBS like today (mev-boost)
  • A builder B is connected to X% of the stake
  • Builder can charge a fee for priority inclusion
    • E.g. 1% of transaction value
  • Fee decays based on time delay from user preference
    • To account for builder not having access to all stake
  • Fee can vary to prioritize w/in “builder’s log”
  • Centralized builder server can provide facade for privacy

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Accountability? Improving trust model?

  • Previous design puts a lot of trust in builder
    • Permissioned, centralized actor

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  • Can we do better? Yes… in the future
    • Gossip-transport: anyone can participate
    • Encrypted transactions: maintain privacy
    • Embed in smart contract (“context-aware transactions”) to handle payment
  • How about soon-ish?
    • Still work w/ centralized builders
    • Get receipts for inclusion
    • Can be bonded against builder stake with a slashing model

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Thank you!

Alex Stokes

Researcher, EF

@ralexstokes