XGA Superchain
Rollups can use their own ERC20 token and deposit with us on L1 to get execution credit on our L2. The execution credit is overvalued at a fixed exchange rate that we define. When a user wants to withdraw from the rollup, a tax is applied on their original deposit providing settlement. The gas mechanics of the rollup are further changed such that we no longer burn the base fee and that priority fees become a proxy for a new blob priority fee. This means rollups can use their token to bribe L1 validators via our AVS setup for XGA. We would get a blob fee (this is the captive premium)[1] calculated on the transaction priority fee.
Users (i.e. searchers, traders, solvers, builders, etc) use approved ERC20 tokens to pay for fees at a fixed exchange rate of ‘execution credits’ on the XGA L2.
Superchain Fee Market
The EIP-1559 base fee per gas (base fee) on XGA L2 is calculated by XGA L1 protocol contracts and via the sequencer set at the block level on L2. The benefit of this is that there is a fixed exchange rate and ratio.
The XGA Sequencer applies the base fee value at the block level for all transactions and instead of burning the base fee sends it to a well known address (“superchain sequencer treasury, SST”) a defined immutable constant in the XGA L1 protocol contract. This address is a multisig address.
Figure 1: Spread between L1 and L2 fees
Priority Fees become Superchain Tax
A tax amount based on gas priority fee per gas of any transaction. When the sequencer runs the auction settlement function transactions that transfer a sufficient amount of an ERC20 currency to cover the clearing fee (to the SST). If that succeeds, the transaction proceeds. Otherwise, the transaction reverts.
Blob fees become Superchain Blob Tax
A tax amount based on blob base fee per gas of any blob, this is accrued and accumulates until a withdrawal from the L2 is requested. These fees are retained then by the SST.
AVS Yield
Validators that use the AVS Boost and Relay earn less than what they have configured for min-bid. At a ETH/USD rate of $4,000 this would yield participating validators as much as 7 million dollars per month (60–84 million dollars annually). This is equivalent to ~$80 USD annually per validator (0.05% APR) and represents about 10% of an average proposer’s execution layer rewards or 1.5% of their total rewards.
Captive Insurance Yield
These fees accumulate and are paid to the Captive Insurance Pool participants.
FOLD Staking and Liquidity
We will be launching the stakingi frontend sometime in the next two weeks. Before the frontend goes live we will be adding liquidity outside the staking contracts. We will have at least $150,000 provdied at all ranges. This is important to be done first and directly through the Uniswap contracts.
Footnotes
The marginal utility loss to restakers if the new system loses liveness should be small, assuming that only accountable actions (i.e., safety violations) are slashed. ↩︎