Parallel Execution Fee Mechanisms

Abdoulaye Ndiaye

Papers from arXiv.org

Abstract: This paper investigates how pricing schemes can achieve efficient allocations in blockchain systems featuring multiple transaction queues under a global capacity constraint. I model a capacity-constrained blockchain where users submit transactions to different queues -- each representing a submarket with unique demand characteristics -- and decide to participate based on posted prices and expected delays. I find that revenue maximization tends to allocate capacity to the highest-paying queue, whereas welfare maximization generally serves all queues. Optimal relative pricing of different queues depends on factors such as market size, demand elasticity, and the balance between local and global congestion. My results have implications for the implementation of local congestion pricing for evolving blockchain architectures, including parallel transaction execution, directed acyclic graph (DAG)-based systems, and multiple concurrent proposers.

Date: 2024-10, Revised 2025-02
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://arxiv.org/pdf/2410.09555 Latest version (application/pdf)

Related works:
Working Paper: Parallel Execution Fee Mechanisms (2024)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:2410.09555

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators (help@arxiv.org).