How far can Filecoin’s Gas fees go down?

Filecoin is getting a big upgrade at the end of this month. This upgrade will introduce some new features that will be very effective in reducing Gas fees.

How far can Filecoin's Gas fees go down?

This upgrade is highly anticipated as the high Gas fees have been a hindrance to the growth of Filecoin’s computing power. But how far can the Gas fee be reduced after the upgrade? To the floor? Not necessarily.

Filecoin’s version of this upgrade network is Network v13, also known as HyperDrive, which corresponds to Specs-Actors version V5. The fully implemented versions correspond to Lotus v1.10.0 and Venus 0.9.7. We’ll see what happens.

The main features of this version upgrade include

Actor v5

FIP 0013, Aggregate PoRep for Replication Proofs

FIP 0008, Batched Precommit for Replication Proofs

FIP 0012, Allow verification of client Datacap accumulation

FIP 0011, Simplify Consensus Error Penalty

FIP 0015, temporal proofs are no longer exempt from Gas fees

The main thing that everyone is looking forward to is the implementation of FIP-0013 and FIP-0008, which will allow users to perform bulk operations or aggregate processing for the two types of messages that currently consume the most Gas, and therefore will likely result in a significant reduction in Gas base fees. So does the upgrade bring Gas down to a very low level? In fact, this upgrade only provides more means to save Gas. Whether the Gas base cost is reduced depends on market regulation, but it is certain that within a reasonable Gas cost range, the network will have more resources to support greater arithmetic growth, effective data storage, and transactions.

Some people ask whether Gas will be reduced to a very low level, and whether they can predict how much Gas will be reduced in the end. This is really difficult. I went back to a previous article I wrote about Filecoin and made a prediction, which was published in early 2020, almost 10 months before the main web went live. Fortunately, 2 out of the 3 predictions made have come true, and the last one is still to be verified, but it doesn’t seem to be a big problem at the moment.

The total computing power of the first phase of the test network will exceed 3PiB

The total computing power of the second phase of the test network will exceed 20PiB within one month

The total computing power of the official network should exceed 5000PiB within one year, with a target of 10000PiB or more.

The prediction of Filecoin’s network capacity reaching 10EiB in one year at the beginning of 2020 was indeed a guess at that time. Although there is some logic behind it, there are so many uncontrollable factors that most of them are inaccurate, and the final result is often in line with expectations can only be said to be better luck.

So where can Gas Base-fee go after this upgrade? I’m going to take some wild guesses, but I’m going to take them for what they are and not take them seriously. Gas Base-Fee is not expected to stay on the floor (100 AttoFil) for a long time in the next few months or a year, but to fluctuate in a range that everyone considers acceptable. The average Gas price may be in the range of 0.1 Fil (up or down several times the error, i.e. 0.01 ~ 0.9 Fil is correct).

Why? There are a number of reasons.

  1. the new features simply provide new means

The implementation of these new FIPs simply provides a means of saving Gas consumption, such as batch submission to save some Gas costs and aggregation to prove that Gas consumption can be reduced several times. But then again, these are some newly added features and all previous methods have not been removed. Miners can still pre-submit and submit proofs in the old way. So it’s the miner’s choice to submit with or without these new messages. At one extreme, if everyone doesn’t use them, then no change will occur; at the other extreme, if everyone uses them, then Gas consumption will be much lower. But both of these scenarios are unrealistic. Because of the current high cost of Gas, it is expected that a number of large miners will adopt it. But even if they do, then it is the miners’ choice how to adopt it and what parameters to choose. Therefore, extreme Gas savings of 10x-25x should not be directly applied to the prediction. 2.

  1. the adoption of new methods may not be beneficial

A very realistic scenario is that FIP-0013 and FIP-0008, with their support for batching and aggregation, will delay the average message upload time for miners using these new methods compared to the previous methods, i.e., may result in a slightly later increase in arithmetic. This later arithmetic growth may, in theory, reduce the chance of block gains for a small period of time.

In other words, the consumption is reduced in the process of arithmetic growth, but the profit opportunity is also lost a little. This loss is proportional to the time of deferral. Therefore, it is possible that big miners will be a little more aggressive in adopting new methods, while small miners will be less aggressive due to the longer time spent in accumulating messages, when the Gas cost is already lower.

  1. It’s a dynamic balance

Miners always want to maximize their benefits, so it is possible to do careful design and optimization on whether to send in bulk or generate aggregated proofs, and at what scale of bulk and aggregation. If the Gas fee is already negligibly low, or if the Gas fee is already too low to offset the loss of profitability from late submissions, fewer people will adopt the new approach. Messages will then increase and Gas fees will rise. When the Gas fee rises to the point where the submission proof consumption becomes greater than the profit, rational miners will consider more aggregation. Thus, this creates a negative feedback system, which is a dynamic equilibrium, a market-regulated process. For more on Filecoin’s negative feedback, see: Filecoin’s control loop and feedback mechanism

But, what we should see is that it is with these means that all miners in competition contain a conscious and unconscious cooperation to regulate the Gas fee so that it can be maintained at a reasonable level for a fairly wide range of network loads. This is the subtlety of this design.

This reasonable level of Gas fee is a level that most miners agree is not very low and not very high. It will continue to be relatively flat until there are big changes in the Filecion ecosystem. This should already be a very good thing for the real network.

Also, there is a lot of talk about this upgrade increasing Filecoin’s network processing power, or increasing TPS, but that is actually inaccurate. This upgrade does not increase TPS, nor does it change the processing power of the Filecoin network. The upgrade is designed to reduce the Gas consumption of the Filecoin network’s growing arithmetic by reducing the Gas consumption of the two main types of messages that consume Gas, or keeping it at a reasonable and adjustable level. This allows the processing power of the Filecoin network to be freed up to handle many other messages, such as transactions, really data storage, and so on.

So what you’ll actually see is that when the upgrade is complete, you’ll see a reduction in the number of replication proof-related messages. Then, if you go to filscan.io and look at the average number of messages per block, it will also be less than it was before the upgrade for a certain period of time. For example, if it’s over 500 now, you might see under 400 after the upgrade.

This upgrade will untie the strings that bind Filecoin’s arithmetic growth and will show you a more realistic picture of the Filecoin network’s engagement fervor and ecological development. The biggest positive is that Filecoin’s Gas price will remain relatively stable for quite some time, which is very beneficial for the ecological development.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/how-far-can-filecoins-gas-fees-go-down/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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