arXiv subjects

Akaki Mamageishvili

Publications and source records attributed to Akaki Mamageishvili.

At least 19 recordsLinked to original sources

arXiv2026

One Node, Two Roles: Simultaneous Contests for Validation and Attention in Rollups

An optimistic rollup is safe as long as at least one honest validator executes its state transition function (STF) and disputes any assertion that is inconsistent with the result of the execution. Allowing anyone to participate, however, does not give incentive to do so: as long as every assertion is correct, verifying assertion correctness goes unpaid. Attention mechanisms address this by paying nodes to execute the rollup's STF, regardless of whether they participate in the validation process. Since a single node operator can back many registered identities with a single execution, paying per identity does not buy execution diversity, that is, the number of operators that independently execute. In this work we provide a new modeling framework for this problem. We formalize the underlying cryptographic primitive as a new notion, arguments with registered provers, whose properties include a form of non-amortizability that, to our knowledge, has not been studied for modern succinct cryptographic proofs before. We design validation and attention reward mechanisms and analyze them as two coupled Tullock-like contests, in which an operator pays once for the required execution and then chooses how many identities to deploy in each role. We quantify the attainable range of execution diversities in equilibrium as a function of the marginal cost of deploying an extra attention identity. We use our framework as a lens through which we compare two attention mechanisms, TRACE (MARBLE 2026) and Proof of Diligence (AFT 2024). In particular, we show that as opposed to Proof of Diligence, in TRACE the marginal cost mentioned above can be adjusted to support a higher execution diversity. As a case study, we apply our results to Arbitrum One, a widely deployed optimistic rollup.

cs.CR↗

arXiv2026

Priority Gas Auction Cadence and Searcher Competition: Evidence from Flashblocks on Base

Flashblocks divide a block's priority gas auction into shorter sequential auctions that commit transaction order before the block is complete. We ask how this auction cadence affects bidding and competition among automated arbitrageurs, or searchers. In July 2025 Base replaced a single 2 s auction with ten 200 ms auctions. We use this change to estimate the searcher response from on-chain data alone. On an address-day panel of 3,032 searchers and 8,053 activity-matched controls, a difference-in-differences design estimates a 0.187 gwei fall in the effective priority fee (59% of the searcher pre-period mean). The share of searcher priority-fee value paid in the first tenth of block gas falls from 0.98 to 0.28. This fee compression is the identified effect. The revert-rate response is not (causally) identified and is reported descriptively. At the level of a single opportunity, the winning fee splits into an approximately invariant floor and a competitive premium. The premium scales about linearly with auction duration at high contention and less steeply at low contention. A first-price auction model with uncertain arrival and partial payments by losing searchers accounts for this pattern. We match attempts to the pool they contest. A higher-fee transaction reverts behind a lower-fee winner that landed earlier in 1.9 to 2.7% of contested opportunities by value, an upper bound. Latency therefore decides part of the ordering. A micro-auction model projects diminishing returns from shortening the window below 200 ms, as bids approach a nonzero floor. Rollups such as Arbitrum One now make auction cadence a governance tunable parameter, so these estimates inform how it is set.

cs.CE↗

arXiv2026

Price Elasticity of Gas Demand on L1 and L2: Evidence from Ethereum and Arbitrum

We estimate the causal price elasticity of gas demand on Ethereum mainnet (L1) and Arbitrum One (L2), a quantity necessary for calibrating fee mechanism simulations, evaluating resource pricing reforms, and explaining observed usage patterns. A two-way fixed effects panel regression instrumented by each wallet's own lagged base fee removes the congestion-driven endogeneity that causes naive regressions to substantially underestimate demand sensitivity. On Ethereum mainnet (full year 2025), the pooled IV elasticity is -0.006***, near-inelastic: a 10% fee increase reduces total gas demand by approximately 0.06%. On Arbitrum One (October 2025--April 2026), the pooled IV elasticity is -0.036**. Both chains are inelastic in the aggregate, with L2 measurably more responsive than L1. A per-resource decomposition of L2 demand reveals elasticities ranging from modestly elastic computation (-0.027*) to -0.27*** for refunds, with storage growth (-0.15***) and calldata (-0.06*) in between. Behavioral clustering identifies always-on protocol wallets as near-inelastic and high-volume operators as substantially more responsive, with cluster-level elasticities up to roughly 6x the pooled estimate. These results establish an empirical foundation for downstream simulations and for evaluating fee mechanism designs.

econ.EM↗

arXiv2026

Just-in-Time Resale in an Ahead-of-Time Auction for Faster Execution

We study Arbitrum's Timeboost auction, an ahead-of-time mechanism that sells a 200ms ordering advantage in an otherwise first-come, first-served transaction ordering policy. The market naturally divides into two phases: a competition phase, in which the dominant searchers compete directly in the primary auction, and a coordination phase, in which they source fast-lane access through Kairos, a Just-in-Time resale intermediary. We use auction bids, time-boosted transactions, and on-chain payment traces to study how well ahead-of-time bids predict realized CEX--DEX arbitrage profits and how the emergence of resale changes surplus allocation. We find that ahead-of-time bids are noisy predictors of short-horizon arbitrage profits. During the competition phase, bid--profit correlations are statistically significant but economically modest at the round level, while correlations increase when profits are aggregated over longer horizons. This suggests that bidders can identify favorable market conditions but face substantial uncertainty about the realized value of any individual one-minute fast-lane interval. After the Kairos transition, competition in the primary auction weakens sharply: in our focused transition-analysis window, paid bids fall from 62.7% of the top bid before the transition to 14.8% thereafter, while total searcher profits remain broadly similar. The resulting dynamics are most consistent with coordination through a common intermediary rather than direct competition in the primary auction. More broadly, our findings suggest that ahead-of-time allocation mechanisms can be vulnerable to secondary-market intermediation when competition among dominant participants is weak.

cs.GT↗

arXiv2026

The Cost of Secure Restaking vs. Proof-of-Stake

We compare the total capital efficiency of secure restaking and Proof-of-Stake (PoS) protocols. First, we consider the sufficient condition for the restaking graph to be secure. The condition implies that it is always possible to transform such a restaking graph into separate secure PoS protocols. Next, we derive two main results: upper and lower bounds on the required extra stakes to add to the validators of the secure restaking graph to be able to transform it into secure PoS protocols. In particular, we show that the restaking savings compared to PoS protocols can be very large and can asymptotically grow as a square root of the number of validators. We also study a complementary question of aggregating secure PoS protocols into a secure restaking graph and provide matching lower and upper bounds on the PoS savings.

cs.CR↗

arXiv2026

Timing Games: Probabilistic backrunning and spam

There are $n$ players who compete by timing their actions. An opportunity appears randomly on a time interval. Whoever takes an action the fastest after the opportunity has arisen wins. The occurrence of the opportunity is observed only with a delay. Taking actions is costly. We characterize the unique symmetric equilibrium of this game and study worst-case inefficiency of equilibria. Our main motivation is the study of ``probabilistic backrunning" on blockchains, where arbitrageurs want to place an order immediately after a trade that impacts the price on an exchange or after an oracle update. In this context, the number of actions taken can be interpreted as a measure of costly ``spam" generated to compete for the opportunity.

cs.GT↗

arXiv2026

On Sybil-proof Mechanisms

We show that in the single-parameter mechanism design environment, the only non-wasteful, symmetric, incentive compatible and Sybil-proof direct mechanism is a second price auction with symmetric tie-breaking. Thus, if there is private information, lotteries or other mechanisms that do not always allocate to a highest-value bidder are not Sybil-proof or not incentive compatible. Moreover, we show that our main (im)possibility result extends beyond linear valuations, but not to multi-unit object allocation with capacity constrained bidders. We also provide examples of mechanisms (with higher interim payoff for the bidders than a second price auction) that satisfy all of the other axioms and a weaker, Bayesian notion of Sybil-proofness. Thus, our (im)possibility result does not generalize to the Bayesian setting and we have a larger design space: With Sybil constraints, equivalence between dominant strategy and Bayesian implementation (that holds in classical single-parameter mechanism design without Sybils) no longer holds.

cs.GT↗

arXiv2025

TimeBoost: Do Ahead-of-Time Auctions Work?

We study the performance of the TimeBoost auction, by comparing cumulative fixed time markout of fast lane trades over the TimeBoost interval to bids for the fast lane. Such comparison allows us to assess how well bids predict future extracted value from the time advantage. The correlation between winning bids and markouts is weak across bidders, suggesting that bids are a noisy predictor of extracted value. The correlation slightly improves when comparing paid bids (the second highest bid) instead of winning bids to markouts, which we attribute to the fact that the auction is more of a common value type. In all settings, the relative order of the most frequent bidder performance remains the same, together with their absolute profits. Bids and markouts aggregated over long time intervals exhibit much higher correlation, indicating that bidders detect trends much better than identify when the high arbitrage value is exactly available. One possible explanation for this is the fact that the correlation between previous minute markouts and current minute bids is significant, suggesting that the previous minute markouts is used to predict the next minute value when bidding.

cs.GT↗

arXiv2025

Searcher Competition in Block Building

We study the amount of maximal extractable value (MEV) captured by validators, as a function of searcher competition, in blockchains with competitive block building markets such as Ethereum. We argue that the core is a suitable solution concept in this context that makes robust predictions that are independent of implementation details or specific mechanisms chosen. We characterize how much value validators extract in the core and quantify the surplus share of validators as a function of searcher competition. Searchers can obtain at most the marginal value increase of the winning block relative to the best block that can be built without their bundles. Dually this gives a lower bound on the value extracted by the validator. If arbitrages are easy to find and many searchers find similar bundles, the validator gets paid all value almost surely, while searchers can capture most value if there is little searcher competition per arbitrage. For the case of passive block-proposers we study, moreover, mechanisms that implement core allocations in dominant strategies and find that for submodular value, there is a unique dominant-strategy incentive compatible core-selecting mechanism that gives each searcher exactly their marginal value contribution to the winning block. We validate our theoretical prediction empirically with aggregate bundle data and find a significant positive relation between the number of submitted backruns for the same opportunity and the median value captured by the proposer from the opportunity.

cs.GT↗

arXiv2025

MEV Capture Through Time-Advantaged Arbitrage

As blockchains begin processing significant economic activity, the ability to include and order transactions inevitably becomes highly valuable, a concept known as Maximal Extractable Value (MEV). This makes effective mechanisms for transaction inclusion and ordering, and thereby the extraction of MEV, a key aspect of blockchain design. Beyond traditional approaches such as ordering in a first-come-first-serve manner or using priority fees, a recent proposal suggests auctioning off a time advantage for transaction inclusion. In this paper, we investigate this time advantage mechanism, focusing specifically on arbitrage opportunities on Automated Market Makers (AMMs), one of the largest sources of MEV today. We analyze the optimal strategy for a time-advantaged arbitrageur and compare the profits generated by various MEV extraction methods. Finally, we explore how AMMs can be adapted in the time advantage setting to capture a portion of the MEV.

cs.DC↗

arXiv2025

Economic Censorship Games in Fraud Proofs

Optimistic rollups rely on fraud proofs -- interactive protocols executed on Ethereum to resolve conflicting claims about the rollup's state -- to scale Ethereum securely. To mitigate against potential censorship of protocol moves, fraud proofs grant participants a significant time window, known as the challenge period, to ensure their moves are processed on chain. Major optimistic rollups today set this period at roughly one week, mainly to guard against strong censorship that undermines Ethereum's own crypto-economic security. However, other forms of censorship are possible, and their implication on optimistic rollup security is not well understood. This paper considers economic censorship attacks, where an attacker censors the defender's transactions by bribing block proposers. At each step, the attacker can either censor the defender -- depleting the defender's time allowance at the cost of the bribe -- or allow the current transaction through while conserving funds for future censorship. We analyze three game theoretic models of these dynamics and determine the challenge period length required to ensure the defender's success, as a function of the number of required protocol moves and the players' available budgets.

cs.GT↗

arXiv2024

BoLD: Fast and Cheap Dispute Resolution

BoLD is a new dispute resolution protocol that is designed to replace the originally deployed Arbitrum dispute resolution protocol. Unlike that protocol, BoLD is resistant to delay attacks. It achieves this resistance without a significant increase in onchain computation costs and with reduced staking costs.

cs.CR↗

arXiv2023

Crowdsearch

A common economic process is crowdsearch, wherein a group of agents is invited to search for a valuable physical or virtual object, e.g. creating and patenting an invention, solving an open scientific problem, or identifying vulnerabilities in software. We study a binary model of crowdsearch in which agents have different abilities to find the object. We characterize the types of equilibria and identify which type of crowd maximizes the likelihood of finding the object. Sometimes, however, an unlimited crowd is not sufficient to guarantee that the object is found. It even can happen that inviting more agents lowers the probability of finding the object. We characterize the optimal prize and show that offering only one prize (winner-takes-all) maximizes the probability of finding the object but is not necessarily optimal for the crowdsearch designer.

econ.TH↗

arXiv2023

Shared Sequencing and Latency Competition as a Noisy Contest

We study shared sequencing for different chains from an economic angle. We introduce a minimal non-trivial model that captures cross-domain arbitrageurs' behavior and compare the performance of shared sequencing to that of separate sequencing. While shared sequencing dominates separate sequencing trivially in the sense that it makes it more likely that cross-chain arbitrage opportunities are realized, the investment and revenue comparison is more subtle: In the simple latency competition induced by First Come First Serve ordering, shared sequencing creates more wasteful latency competition compared to separate sequencing. For bidding-based sequencing, the most surprising insight is that the revenue of shared sequencing is not always higher than that of separate sequencing and depends on the transaction ordering rule applied and the arbitrage value potentially realized.

cs.GT↗

arXiv2023

EIP-4844 Economics and Rollup Strategies

We study the economics of the Ethereum improvement proposal 4844 and its effect on rollups' data posting strategies. Rollups' cost consists of two parts: data posting and delay. In the new proposal, the data posting cost corresponds to a blob posting cost and is fixed in each block, no matter how much of the blob is utilized by the rollup. The tradeoff is clear: the rollup prefers to post a full blob, but if its transaction arrival rate is low, filling up a blob space causes too large delay cost. The first result of the paper shows that if a rollup transaction arrival rate is too low, it prefers to use the regular blockspace market for data posting, as it offers a more flexible cost structure. Second, we show that shared blob posting is not always beneficial for participating rollups and change in the aggregate blob posting cost in the equilibrium depends on the types of participating rollups. In the end, we discuss blob cost-sharing rules from an axiomatic angle.

cs.GT↗

arXiv2023

Decentralized Attack Search and the Design of Bug Bounty Schemes

Systems and blockchains often have security vulnerabilities and can be attacked by adversaries, with potentially significant negative consequences. Therefore, infrastructure providers increasingly rely on bug bounty programs, where external individuals probe the system and report any vulnerabilities (bugs) in exchange for rewards (bounty). We develop a simple contest model of bug bounty. A group of individuals of arbitrary size is invited to undertake a costly search for bugs. The individuals differ with regard to their abilities, which we capture by different costs to achieve a certain probability to find bugs if any exist. Costs are private information. We study equilibria of the contest and characterize the optimal design of bug bounty schemes. In particular, the designer can vary the size of the group of individuals invited to search, add a paid expert, insert an artificial bug with some probability, and pay multiple prizes.

econ.TH↗

arXiv2023

Buying Time: Latency Racing vs. Bidding in Transaction Ordering

We design TimeBoost: a practical transaction ordering policy for rollup sequencers that takes into account both transaction timestamps and bids; it works by creating a score from timestamps and bids, and orders transactions based on this score. TimeBoost is transaction-data-independent (i.e., can work with encrypted transactions) and supports low transaction finalization times similar to a first-come first-serve (FCFS or pure-latency) ordering policy. At the same time, it avoids the inefficient latency competition created by an FCFS policy. It further satisfies useful economic properties of first-price auctions that come with a pure-bidding policy. We show through rigorous economic analyses how TimeBoost allows players to compete on arbitrage opportunities in a way that results in better guarantees compared to both pure-latency and pure-bidding approaches.

cs.GT↗

arXiv2023

Incentive Schemes for Rollup Validators

We design and analyze attention games that incentivize validators to check computation results. We show that no pure strategy Nash equilibrium of the game without outside parties exists by a simple argument. We then proceed to calculate the security of the system in the mixed Nash equilibrium, as a function of the number of validators and their stake sizes. Our results provide lower and upper bounds on the optimal number of validators. More concretely, a minimal feasible number of validators minimizes the probability of failure. The framework also allows to calculate optimum stake sizes, depending on the target function. In the end, we discuss optimal design of rewards by the protocol for validators.

cs.GT↗