ETHGas Secures $12 Million in Seed Funding
ETHGas, a trading platform for Ethereum blockspace, has successfully secured $12 million in a seed funding round, primarily backed by Polychain Capital. This financial boost is particularly notable in light of recent comments from Vitalik Buterin, one of the co-founders of Ethereum, who proposed the creation of an onchain market for “gas futures”. He suggested that such a mechanism could provide users with clearer insights into anticipated fees and enable them to hedge their future expenses.
Transforming Blockspace Allocation
In its announcement, ETHGas emphasized the urgent requirement for a fresh approach to how blockspace is allocated within the Ethereum network. The innovative trading platform initiated its operations with an impressive $800 million in commitments from a diverse array of validators, builders, and other active participants in the ecosystem.
As part of its mission, ETHGas is seeking to transform blockspace into a commoditized asset. The firm has launched a venture termed “Real-Time Ethereum,” aspiring to enhance the transaction speed on the network significantly. According to the company, users will have the chance to buy commitments to blockspace known as “pre-confirmations,” allowing them to secure transaction execution at specific moments.
Improving Transaction Speed
Kevin Lepsoe, founder of ETHGas, explained how this mechanism improves upon current block production services frequently utilized by maximum extractable value (MEV) bots. He described a configuration where the block is segmented into “240 pieces, each lasting 50ms,” leading to transaction times that are almost immediate. Lepsoe claims that this method would result in drastically reduced MEV issues, yielding a speedy Ethereum experience with approximately 50ms block times. While he noted the potential for even faster executions, he admitted the system may introduce certain centralization challenges.
Lepsoe articulated that the potential rewards for Ethereum validators could increase by eight to ten times should the entire network transition to real-time operations, a scenario that could push towards further centralization. He referenced existing centralization concerns, highlighting that entities like blockbuilders and relays already process around half of Ethereum’s blocks.
Addressing Centralization Risks
With a proactive mindset, Lepsoe mentioned that, assuming their methods prove successful, ETHGas plans to establish multiple nodes with a leader election protocol to address centralization risks. However, he conceded that implementing such changes would require considerable community collaboration and effort.
Additionally, ETHGas claims its platform can handle over 10,000 transactions per second with customizable block placement for users. Pre-confirmations are flexible, allowing clients to book entire blocks or ensure their transactions are included at guaranteed positions. Nevertheless, current capacity remains constrained as further validators come onboard.
Execution Guarantees and Future Plans
The platform has also developed execution guarantees, where not only is inclusion within a block assured, but also a predetermined price or position. For instance, if a user wishes to execute a series of trades with assured outcomes, this offering caters to such needs.
Although execution guarantees have been trialed on the Ethereum mainnet, widespread implementation isn’t expected until early 2026. Validators are responsible for honoring these pre-confirmations, with the option to offer collateral as Ether or restaked Ether via EigenLayer. Should any agreement fail to be upheld, the validators face penalties proportional to the blockspace acquired, and collateral may be transferred to the purchasing party.
Lepsoe stated that thus far, 99.96% of pre-confirmations have been honored, although independent verification of this statistic has not been achieved. He emphasized that reliance on ETHGas for mediation and evaluation of slashing remains paramount, asserting that this has not presented any substantial issues to date.
