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The Impact of Ethereum Throughput and Fees on Transaction Latency During ICOs

Authors Michael Spain, Sean Foley, Vincent Gramoli

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OASIcs.Tokenomics.2019.9.pdf
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Author Details

Michael Spain
  • School of Computer Science, University of Sydney, Australia
Sean Foley
  • School of Business, University of Sydney, Australia
Vincent Gramoli
  • School of Computer Science, University of Sydney, Australia
  • Data61-CSIRO, Sydney, Australia

Funding

This research is in part supported under Australian Research Council Discovery Projects funding scheme (project number 180104030) entitled "Taipan: A Blockchain with Democratic Consensus and Validated Contracts". Vincent Gramoli is a Future Fellow of the Australian Research Council.

Acknowledgements

We wish to thank our colleagues, Ralph Holz and Nate Wiggins, for sharing the Geth Data. We also benefited from the publicly available datasets of Infura and Etherscan.

Cite AsGet BibTex

Michael Spain, Sean Foley, and Vincent Gramoli. The Impact of Ethereum Throughput and Fees on Transaction Latency During ICOs. In International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2019). Open Access Series in Informatics (OASIcs), Volume 71, pp. 9:1-9:15, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2020)
https://doi.org/10.4230/OASIcs.Tokenomics.2019.9

Abstract

The Ethereum blockchain has gained popularity for its ability to implement Initial Coin Offerings (ICOs), whereby a buyer enters a market order agreement with a seller in order to purchase cryptographic tokens at an agreed price. The popularity of ICOs in 2017 has created an increasingly adversarial environment among potential buyers, who compete for what is often a fixed supply of tokens offered for a limited period of time. We study the impact of a series of ICOs in order to understand the relationship between transaction fees, throughput and latency in Ethereum. Our analysis considers the effects on both Ethereum’s service providers, known as miners, and users who issue transactions in the network. Our results show that while buyers incentivise miners generously to include their transactions during ICOs, the latency of these transactions is predominantly determined by the levels of supply and demand in the network.

Subject Classification

ACM Subject Classification
  • Security and privacy → Database and storage security
  • Security and privacy → Economics of security and privacy
  • Security and privacy → Human and societal aspects of security and privacy
Keywords
  • ICO
  • Gas
  • Ethereum
  • Transaction Fee
  • Latency
  • Fairness

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