Perils of Parallelism: Transaction Fee Mechanisms under Execution Uncertainty

2026-04-05

AI Summary

Existing blockchain transaction fee mechanisms struggle to simultaneously achieve performance, fairness, and incentive compatibility under parallel execution and execution uncertainty, while also failing to effectively align risk-sharing between users and schedulers. This work formalizes, for the first time, the mechanism design challenge in this setting, revealing a fundamental trade-off between user protection and scheduler revenue and establishing an impossibility result showing that both objectives cannot be fully satisfied simultaneously. Drawing on game theory, mechanism design, and formal verification, we propose a novel transaction fee mechanism that achieves an optimal balance within theoretical limits. Our results provide both a theoretical foundation and a practical solution for fee mechanism design in high-performance blockchains such as Sui and Monad.

Abstract

Modern blockchains increasingly rely on parallel execution to improve throughput. We show several industry and academic transaction fee mechanisms (TFMs) struggle to simultaneously account for execution parallelism while remaining performant and fair. First, if parallelism affects fees, adversarial protocol manipulations that offset possible benefits to throughput by introducing fake transactions become rational: users can insert functionally useless parallel transactions solely to reduce fees, and schedulers can create useless sequential transactions to increase revenue. Execution contingency, a core feature of expressive programming languages, both exacerbates the aforementioned threats and introduces new ones: (1) users may overpay for unused resources, and (2) scheduler revenue is harmed when reserved scheduling slots go unused due to contingency. We introduce a framework for this challenging setting, and prove an impossibility, highlighting an inherent tension: both parallelism and contingency involve a trade-off between minimizing risks for users and schedulers, as favoring one comes at the expense of the other. To complete the picture, we introduce a fee mechanisms and prove that they achieve the boundaries of this trade-off. Our results provide rigorous foundations for evaluating designs advanced by notable blockchains, such as Sui and Monad.

Problem

• parallelism
• transaction fee mechanisms
• execution uncertainty
• execution contingency
• blockchain

Innovation

• parallel execution
• transaction fee mechanisms
• execution contingency
• impossibility result
• blockchain scheduling