This is a signaling proposal to increase the protocol-enforced minimum gas price to 0.025 uOSMO. This represents a 10x increase in transaction fees from the current rate of 0.0025 uOSMO.
Over the last several months Osmosis has witnessed a plague of arbitrage bot spam that has significantly and negatively impacted the performance of the chain. Several times, the chain has been so congested to the point that no transactions can get through, effectively halting the chain for users.
Most recently, this occurred during the launch of Celestia’s TIA token and a significant upward price movement event for OSMO. This likely resulted in millions of dollars in lost volume on the Osmosis DEX.
While a solution for this in the form of an EIP-1559 fee market developed by Skip Protocol has been proposed for this, the chain cannot afford to wait for this solution to go live. The Osmosis chain is frequently and regularly unstable, impacting value flow to its core products, including the DEX itself, Levana perps, and Mars protocol. This event also represents a significant challenge to these products as they are reliant on consistent asset pricing across markets to prevent price manipulation attacks.
This proposal is a temporary measure, and can be reverted once Skip’s fee markets are live in production on the Osmosis mainnet.
If passed, this proposal also signals to Osmosis contributors (Osmosis Labs) to propose a software upgrade within 7 days of the passage of this proposal implementing the proposed minimum fee changes.
This would make Osmosis transactions cost around $0.40 USD. That seems a bit excessive tbh. This is a huge problem, but we don’t want to create another huge problem in the process of fixing this one
Seconding the request to increase the minimum gas price in efforts to combat the low effort bot spam.
I know there could be a possible issue with setting the minimum gas price so high so “suddenly”. Will it be better to propose this change as “temporary” until a more reliable methodology for gas fees is implemented?
The transactions that this bot is using cost 3.4m in gas.
Staking reward claims seem to cost about 540k in gas
Single route swaps from the UI cost 1.3m in gas
So I think it would be 40 cent txs unless I’m calculating something incorrectly? This is all from Keplr, meaning this is what the average user would experience (which is what I’m optimizing for)
So I’m seeing a lot of consensus here and on other forums for 0.1 uOSMO. Given that’s the case, I will likely be changing this to 0.1 in the final proposal.
The funny thing is, transaction fee being negligible is not necessarily a strength. Look at Ethereum where fees where astronomical, but still it was widely used.
Let’s take this gamble and chase Skip when the EIP-1559 can be implemented. Do we have a time estimate on this? @sunnya97@JohnnyWyles maybe you guys have more insight?
Gas changes aren’t chain side at the moment so it wouldn’t be a software upgrade as such, just a binary upgrade.
This plus the eip 1559 filter that is being work on tonight for deployment ASAP are great stopgaps until the block sdk work is out. Not sure on the timeline there but this will be a greater priority now!
Why not charge the transaction based on the number of transactions carried out within the hour? For instance, between 101 and 200 transactions would be ten times the current price, between 201 and 500 transactions would be twenty times the current price, and for over 500 transactions, it would be one hundred times the current price.
If I was a bot spamming the network, what stops me from transferring my osmo balance to another wallet after 100 transactions and spamming 100 more, then transferring to another? I would only need a few thousand to be able to spam for an hour, which would be no problem since they can be automatically created.
Won’t this proposed change also greatly increase the fees for exchange wallet operating withdrawals? (Which they will pass on directly to the user)
Oh maybe i misunderstood what @darkyadoo was saying.
Skip’s mechanism doesn’t operate on a per-wallet basis. It goes based off the total number of transactions in a block, and sets fees based on the number of txs in the previous block.
The wallet that it comes from is irrelevant.
As far as this fee increase, yeah, it raises costs on everyone using the chain. There’s not really a choice though. Transaction spam that effectively halts the chain and making it unusable is obviously worse.
Hmmm, so effectively when someone is spamming, EVERYONE pays more?
So to make the DEX effectively to expensive to use, one has just to put up a bot which spams transactions until a certain value is hit, stops when the tx is too expensive and reactivates again when the tx fee drops below a certain threshold set in the bot?
Competitors don’t need to outperform Osmosis, but simply spend some funds to make trading to expensive?
I totally agree the spam in itself makes the chain unusable, but directing the costs to everyone might not really be the answer imo. And in essence, suppose the DEX becomes amazingly popular, then this mechanism would make transactions also expensive, right? Not caused by spam, but due to legitimate trades?