Workshop on Rollup Sequencer Economics: Open Questions, organized

Ben Fisch

Rollups are horizontally scaling the application layer of Ethereum. But as computation is sharded across different rollups, the interoperability of applications running on these rollups becomes fragmented, significantly impacting user utility. Moreover, today rollups are operated by centralized servers that decide on which transactions to include and in what order. Fragmented interoperability and sequencing centralization are some of the biggest challenges facing rollups today as they undermine the core value-propositions of Ethereum. Recent efforts have aimed to develop decentralized sequencing layers that are shared among several rollups, both within ecosystems of apps using the same software stack and even across distinct optimistic/zk rollup ecosystems. Shared decentralized sequencing layers have the potential to improve the overall decentralization and interoperability of Ethereum’s rollup-centric future.

This workshop spans two 1.5 hr sessions and focuses on the economic challenges of shared sequencing. Questions include:

1. How is revenue shared among rollups utilizing the same sequencing layer? This particularly tricky for MEV derived from atomic bundles of transactions involving multiple rollups at once

2. There are many different approaches to addressing MEV, ranging from optimizing and democratizing value capture to preventing it entirely. Can a shared sequencing layer simultaneously support multiple approaches favored by each individual rollup?

3. A shared sequencing layer may need to take fees to incentivize its node operators. Should fees be paid in a neutral currency like Eth? Will this additional fee fall on rollup users, or can this be abstracted away at the service layer? Can it be paid through the rollups themselves? Are there pitfalls to certain fee mechanisms, e.g. that may have centralizing effects?

About the organizer

Ben is co-founder and CEO of Espresso Systems, which is building a decentralized sequencing and data-availability layer for Ethereum rollups and app-chains. Espresso Systems has partnered with Eigenlayer to deploy this “Layer 1.5” to the Ethereum physical validator set itself, to minimize additional security assumptions and offer Layer 1 validators exposure to value being created at Layer 2. Ben is also an assistant professor of computer science at Yale University. He completed his PhD at Stanford University under the supervision of Dan Boneh. His graduate research on proof systems, including proofs-of-replication and verifiable-delay-functions, contributed to the development of several prominent blockchains including Filecoin, Chia, and Ethereum’s beacon chain.

About a16z crypto research

a16z crypto research is a multidisciplinary lab that works closely with our portfolio companies and others toward solving the important problems in the space, and toward advancing the science and technology of the next generation of the internet.