The gas war is over: On-chain execution is now a commodity. The new economic battleground is the interoperability layer connecting rollups like Arbitrum and Optimism.
the-modular-blockchain-thesis-explained
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Why Cross-Rollup Fees Will Become the New Gas Wars Battleground
The modular future fragments liquidity and execution. Moving assets between rollups will create a new, complex fee market where users bid for speed and security, mirroring and surpassing today's L1 gas wars.
introduction
THE NEW FRONTIER
Introduction
Cross-rollup transaction fees will become the primary cost and competition layer as modular scaling matures.
Execution is cheap, bridging is not: A swap on Arbitrum costs cents, but moving assets to Base via a canonical bridge introduces multi-day delays and high fixed costs.
Intent-based systems win: Protocols like UniswapX and Across abstract this complexity, turning cross-rollup liquidity into a competitive auction, mirroring early MEV wars.
Evidence: Over 60% of cross-chain volume now flows through these third-party bridges, not official channels, proving users optimize for cost and speed, not security.
thesis-statement
THE BOTTLENECK SHIFT
The Core Thesis: Fragmentation Demands a New Fee Market
As liquidity fragments across rollups, the primary economic competition moves from on-chain block space to cross-chain message delivery.
Gas wars are obsolete. Competition for L1 block space was the dominant fee market. Rollups solved this by batching transactions, moving the economic battleground.
The new battleground is cross-rollup latency. Users and protocols now compete for priority on intent-based bridges like Across and Stargate, not Ethereum blocks.
Fragmentation creates arbitrage. A swap routed through Arbitrum, Base, and Polygon via UniswapX creates three separate fee auctions for cross-chain settlement.
Evidence: Over 60% of DeFi volume now involves multiple chains. The fee revenue for cross-chain messaging protocols will surpass L1 priority gas fees within 18 months.
key-trends
THE NEW BATTLEGROUND
The Three Forces Driving Cross-Rollup Fee Wars
As L2s commoditize, the fight for users and liquidity will shift from cheap execution to seamless, cheap, and secure cross-rollup interoperability.
01
The Liquidity Fragmentation Problem
Every new rollup creates a new liquidity silo. Bridging assets is slow and expensive, creating a $100M+ annual market for bridge fees. Protocols like Uniswap and Aave must deploy on dozens of chains, diluting capital efficiency.\n- User Pain Point: 10-30 minute wait times for native bridges\n- Protocol Pain Point: ~$1M+ deployment cost per chain for major dApps
100+
Active L2s/L3s
$100M+
Annual Fees
02
The Intent-Based Solution (UniswapX, Across)
Shift from pushing assets to declaring desired outcomes. Solvers compete to fulfill cross-chain intents, creating a fee market for optimal routing. This commoditizes the bridge layer itself.\n- Key Benefit: Users get best price & route automatically\n- Key Benefit: ~500ms quote time vs. 20-minute finality waits
~500ms
Quote Speed
20-50%
Cost Savings
03
The Shared Security Premium (EigenLayer, ZK Proofs)
Bridging's core risk is security. AVS restaking via EigenLayer and light-client ZK proofs create a trust-minimized base layer. Bridges that leverage this security can charge a premium, while others compete on cost.\n- Key Benefit: Cryptoeconomic security for messaging layers\n- Key Benefit: Enables generalized cross-rollup states
$15B+
AVS TVL
~0
Trust Assumptions
FEE COMPONENTS
The Anatomy of a Cross-Rollup Fee
Deconstructs the cost drivers for moving value and state between rollups, comparing native bridging, third-party bridges, and intent-based systems.
| Fee Component | Native Bridge (e.g., OP Stack, Arbitrum) | Third-Party Bridge (e.g., Across, LayerZero) | Intent-Based Network (e.g., UniswapX, CowSwap) |
|---|---|---|---|
Base L1 Settlement Gas | ~$10-50 (User pays directly) | ~$2-10 (Amortized across users) | ~$1-5 (Solver pays, baked into quote) |
Destination Rollup Gas | User must hold native gas token | Relayer covers gas, cost passed to user | Solver covers gas, cost baked into quote |
Liquidity Provider Fee | 0% | 0.05% - 0.5% | 0.1% - 1.0% (includes solver profit) |
Proposer/Sequencer Extractable Value (P/SEV) | High (Sequencer controls ordering) | Medium (Relayer competition) | Low (Intents are pre-committed) |
Cross-Domain Message Fee | ~$0.10 - $1.00 | ~$0.05 - $0.50 (optimized) | Bundled into solver quote |
Time-to-Finality Trade-off | ~20 min (L1 finality) | ~2-5 min (optimistic attestation) | < 1 min (instant fill, later settlement) |
Requires Native Gas on Destination | |||
Primary Cost Driver | L1 Gas Auctions | Liquidity Depth & Relayer Margins | Solver Competition & MEV Capture |
deep-dive
THE NEW BATTLEGROUND
From Gas to Passage: How the Fee Market Evolves
Cross-rollup transaction fees will replace L1 gas as the primary economic battleground and user experience bottleneck.
Fee markets shift to L2s. The primary cost for users moves from L1 gas to the fees charged by rollup sequencers and the bridges between them. This creates a new competitive landscape for sequencer revenue and interoperability pricing.
Cross-rollup passage is the new gas. The cost to move assets or state between Arbitrum, Optimism, and zkSync via Across or LayerZero becomes the dominant UX friction. Users will arbitrage these bridge fees like they once did block space.
Intents will commoditize execution. Protocols like UniswapX and CowSwap abstract passage by letting solvers compete on cross-chain routing. This turns fee competition from a user problem into a solver backend optimization.
Evidence: Over 60% of Ethereum's L1 gas is now sequencer batch submissions. The economic value shifts to the L2 settlement layer and the inter-rollup messaging networks that connect them.
protocol-spotlight
CROSS-ROLLUP FEE MARKETS
Architecting the Battleground: Key Protocols
As modular blockchains proliferate, the fight for user liquidity is shifting from L1 gas auctions to the fragmented, competitive landscape of cross-rollup transaction routing.
01
The Problem: Fragmented Liquidity Pools
Every rollup is a sovereign liquidity silo. Bridging assets requires separate, over-collateralized pools on each chain, locking up $10B+ in idle capital. This creates massive inefficiency and high, unpredictable fees for users.
- Capital Inefficiency: TVL is trapped, not flowing.
- Slippage & Latency: Multi-hop swaps suffer from ~30s finality delays and compounding fees.
- Protocol Risk: Each bridge is a new attack surface.
$10B+
Idle Capital
30s+
Delay
02
The Solution: Intent-Based Routing (UniswapX, CowSwap)
Shift from transaction execution to outcome declaration. Users submit a signed intent ("I want X token on Arbitrum"), and a network of solvers competes to fulfill it via the optimal route across rollups and DEXs.
- Optimized Routing: Solvers find paths across Layer 2s, sidechains, and L1.
- Cost Certainty: Users get a guaranteed quote, paying only for the outcome.
- MEV Resistance: Batch auctions and solver competition reduce extractable value.
-50%
Avg. Cost
10x
Route Options
03
The Solution: Universal Liquidity Layers (Across, LayerZero)
Abstract the bridging layer by creating a canonical liquidity network. Protocols like Across use a single liquidity pool on Ethereum, with relayers covering the fast cross-chain transfer. LayerZero enables generic message passing, letting any app build its own fee market atop it.
- Capital Efficiency: One pool services all chains.
- Fast Finality: ~1-2 minute transfers via optimistic verification.
- Composability: Becomes infrastructure for other cross-rollup services.
1-2 min
Transfer Time
15+
Chains Served
04
The New Battleground: Solver Economics
The fee war moves from users bidding for block space to solvers bidding for intent fulfillment. The winning solver captures the spread between the user's max fee and their execution cost. This creates a hyper-competitive, efficient market.
- Profit Maximization: Solvers run sophisticated cross-chain MEV algorithms.
- Staking & Slashing: High-stakes security via bonded solvers.
- Protocol Revenue: Fees are split between solvers, liquidity providers, and the protocol treasury.
$100M+
Solver Stakes
ms
Bid Latency
counter-argument
THE SEQUENCER BOTTLENECK
Counterpoint: Won't Shared Sequencing Solve This?
Shared sequencing centralizes fee competition to a single auction, making cross-rollup payments a primary vector for MEV.
Shared sequencing centralizes competition. A shared sequencer like Espresso or Astria creates a single, high-stakes auction for block space across many rollups. Users and searchers now compete in one venue instead of many, but the economic pressure doesn't disappear—it intensifies.
Cross-rollup payments become premium slots. Transactions requiring atomic composition across chains (e.g., a swap on Arbitrum and a mint on Optimism) are the most valuable to sequence together. This creates a fee market for atomicity, where cross-rollup bundles outbid simple, single-chain transactions.
The gas war moves upstream. Instead of fighting for L1 block space, applications and users fight for priority in the shared sequencer's mempool. Protocols like UniswapX or Across that rely on cross-chain intent fulfillment will embed these costs, passing them to end-users.
Evidence: Espresso's testnet shows sequencer nodes prioritizing bundles with higher fees. This replicates the Ethereum base layer's proposer-builder separation (PBS) dynamics, but now the 'block' is a multi-rollup block.
risk-analysis
WHY CROSS-ROLLUP FEES WILL BECOME THE NEW GAS WARS BATTLEGROUND
The Bear Case: Risks and Centralization Vectors
As modular blockchains proliferate, the cost and control of moving assets between them will define the next era of extractive MEV and centralization.
01
The Problem: Fragmented Liquidity Creates Extractive Rent-Seekers
Every rollup is its own liquidity silo. Bridging assets between them requires professional market makers who capture value through spreads and latency advantages, mirroring CEX arbitrage desks. This creates a new class of fee extractors between the user and the chain.
- Result: Users pay a 5-50 bps premium over the native asset price for every hop.
- Analogy: This is the DEX/CEX arbitrage loop, but now between sovereign execution layers.
5-50 bps
Extraction Premium
100+
Liquidity Pools
02
The Solution: Intent-Based Protocols & Shared Sequencing
Networks like UniswapX, CowSwap, and Across abstract the routing problem. Users submit a desired outcome (an 'intent'), and a decentralized solver network competes to fulfill it at the best rate. This commoditizes the bridge operator.
- Key Shift: Competition moves from user-paid priority gas to solver-paid execution cost.
- Risk: Solver networks can centralize into a few high-capital players, creating a new oligopoly.
~$1B+
Solver Volume
Majority
Fill Rate
03
The Centralization Vector: Proposer-Builder Separation for Cross-Chain
Just as PBS emerged for Ethereum blocks, cross-chain messaging will see a similar stratification. LayerZero relayers, Axelar validators, and shared sequencers (like Espresso, Astria) become the new 'builders'. They control order flow and can extract MEV from interchain transactions.
- Critical Risk: If a few entities dominate sequencing/relaying, they can censor or reorder cross-chain bundles.
- Outcome: The gas auction moves from a single L1 to a multi-chain messaging layer.
~500ms
Latency Advantage
Oligopoly
Market Structure
04
The Endgame: Vertical Integration of the Stack
Major rollup stacks (OP Stack, Arbitrum Orbit, zkSync Hyperchains) will internalize bridging to their own ecosystem. This creates walled gardens with subsidized, fast internal bridges but expensive, slow exits. The 'gas war' becomes a business development war for chain integration.
- User Lock-in: Cheaper to stay within one ecosystem, reducing composability.
- Protocol Risk: Bridging becomes a political tool, subject to governance decisions of the dominant stack.
$10B+
Stack TVL
Subsidized
Internal Fees
future-outlook
THE NEW BATTLEGROUND
The Future: A Commoditized Layer with Premium Lanes
Cross-rollup interoperability will shift competition from raw throughput to fee markets and execution quality, creating a commoditized base layer and premium service lanes.
Cross-rollup fees become the primary battleground because L2 execution is a commodity. Once ZK-rollups achieve feature parity, competition shifts from proving technology to liquidity access and user experience. The winning interoperability layer will be the one that offers the cheapest, fastest, and most reliable asset transfers between ecosystems like Arbitrum, zkSync, and Base.
Premium lanes will emerge for complex intents. Basic token bridging will be a low-margin commodity, won by protocols like Stargate and Across. The high-margin business will be intent-based routing for complex swaps and cross-chain actions, dominated by solvers like UniswapX and CowSwap that compete on execution quality, not just price.
The gas war moves upstream. Today's competition for block space on Ethereum will become competition for message ordering and finality guarantees on shared sequencing layers like Espresso or Astria. Rollups will pay premiums to have their cross-chain messages prioritized, creating a new fee market decoupled from L1 gas.
Evidence: The 90% bridge fee compression. Since 2021, average bridging fees have collapsed by over 90% as competition intensified between LayerZero, Wormhole, and Celer. This trend will accelerate, forcing protocols to differentiate on bundled services like MEV protection and atomic composability to capture value.
takeaways
CROSS-ROLLUP FEES
TL;DR for Busy CTOs
The fight for block space is moving from L1 gas to the fragmented, opaque, and strategically critical fees of cross-rollup messaging.
01
The Problem: Fragmentation Creates Fee Arbitrage
Every rollup (Arbitrum, Optimism, zkSync) has its own fee market. Bridging between them introduces multiple, non-linear fee layers: L2 execution, state proof generation, and L1 settlement. This creates a ~$50M+ monthly market where inefficiencies are exploited, not optimized.
3-5x
Fee Layers
$50M+
Monthly Market
02
The Solution: Intent-Based Routing (UniswapX Model)
Shift from users specifying how to move assets (transaction) to specifying what they want (intent). Let a network of solvers (Across, Socket, Li.Fi) compete to find the cheapest path across rollups via optimistic relays, liquidity pools, or canonical bridges. This commoditizes the bridge layer.
-60%
User Cost
~2s
Solver Latency
03
The Battleground: MEV Extends Across Chains
Cross-rollup transactions are multi-step, creating cross-domain MEV opportunities. The entity controlling the routing (LayerZero, Axelar, CCIP) can extract value via latency arbitrage, liquidity asymmetry, and fee ordering. This turns bridge protocols into the new priority gas auctions.
100ms
Arb Window
New Frontier
For Searchers
04
The Strategic Imperative: Own the Routing Stack
For rollup teams (Arbitrum, Starknet), controlling the canonical bridge is a strategic moat. It dictates fee capture and user flow. The winning cross-rollup fee market will be a standardized auction layer (like EIP-1559 for L2s) that abstracts fragmentation, forcing competition on price, not on vendor lock-in.
Core MoAT
For L2s
Standard Needed
Auction Layer
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