Why Ethereum Needs Fairness Mechanisms that Do Not Depend on Participant Altruism

2026-03-05

AI Summary

This study addresses a critical flaw in Ethereum’s current fairness mechanisms, which rely on the altruistic behavior of block proposers. In practice, however, the majority of proposers depend on centralized block-building services, undermining decentralization and censorship resistance. Leveraging on-chain data, this work presents the first empirical analysis of proposer interactions with external builders, specifically examining whether proposers blindly sign externally constructed blocks. The findings reveal that only 1.4% of proposers consistently uphold decentralization and censorship-resistance goals, while 97.1% directly or indirectly rely on centralized services. These results demonstrate that the assumption of proposer altruism is largely untenable in real-world conditions, thereby challenging the foundational premise of existing fairness mechanisms and calling for new designs grounded in incentive alignment or punitive measures.

Technology Category

• Game Theory and Economic Paradigms: Fair Division
• Philosophy and Ethics of AI: Bias, Fairness & Equity
• Natural Language Processing: Ethics — Bias, Fairness, Transparency & Privacy

Application Category

• Economics, Online Markets and Human Computation: Fairness and ethical considerations in crowd work and in human-in-the-loop AI systems
• Security and Privacy: Data transparency and provenance
• Web Mining and Content Analysis: Web data provenance, reliability, and authenticity

Abstract

Ethereum's ideals of decentralization and censorship resistance are undermined in practice, motivating ongoing efforts to reestablish these properties. Existing proposals for fairness mechanisms depend on the assumption that a sufficient fraction of block proposers adhere to Ethereum's protocols as intended. We refer to such proposers as altruistic, as this behavior may come at the cost of reduced revenue. Prior analyses indicate that a consistent share of 91 percent of proposers delegate block construction to centralized services, effectively signing externally constructed blocks blindly, and are thus not considered altruistic. To assess whether the remaining 9 percent of proposers genuinely exhibit altruistic behavior, we conducted an empirical analysis and found that an additional 6.1 percent also interact with such external services. Further, we found that less than 1.4 percent of proposers consistently acted in accordance with Ethereum's decentralization and censorship resistance objectives. These findings suggest that relying solely on the mere presence of altruistic proposers is insufficient to ensure that proposed fairness mechanisms reestablish Ethereum's ideals, highlighting the need for additional incentive- or penalty-based mechanisms.

Problem

• Ethereum
• fairness mechanisms
• altruism
• decentralization
• censorship resistance

Innovation

• fairness mechanisms
• altruism
• block proposers
• decentralization
• incentive design