# Transaction Fee Mechanism Design for the Ethereum Blockchain: An Economic Analysis of EIP-1559

arXiv: https://arxiv.org/abs/2012.00854 · HTML: https://mlsanity.com/paper/2012.00854/

## Key facts

- Cited by 2 papers in the map (data through 14 Oct 2026).
- First posted on arXiv 1 Dec 2020.

## Built on by (most cited first, 2 of 2)

- [Optimal Dynamic Fees for Blockchain Resources](https://mlsanity.com/paper/2309.12735/) (2023)
- [Spec2Twin-Chain: Orchestrating Bi-Level Optimization with LLMs for Blockchain Digital Twin Construction](https://mlsanity.com/paper/2608.30050/) (2026)

## Abstract (arXiv)

EIP-1559 is a proposal to make several tightly coupled additions to Ethereum's transaction fee mechanism, including variable-size blocks and a burned base fee that rises and falls with demand. This report assesses the game-theoretic strengths and weaknesses of the proposal and explores some alternative designs.