Why Gas Fees Are a Governance Problem, Not Just a Cost Problem

Paying gas in the native token creates a hidden governance tax, forcing users to hold volatile assets just to interact. This excludes users and skews protocol governance towards speculators, not users.

• Distorted Governance: Voter participation gated by ETH holdings, not protocol usage.
• Exclusionary UX: Users must manage multiple token balances for simple actions.

Smart accounts decouple payment from execution via UserOperations and Paymasters. This allows protocols or third parties to sponsor gas in any token, realigning incentives.

• Protocol-Led Growth: DApps can subsidize user onboarding as a customer acquisition cost.
• User Sovereignty: Interact with any chain using stablecoins or loyalty points.

When gas is abstracted, governance power shifts from token hoarders to active users and builders. This enables sustainable, usage-based economies seen in projects like Aerodrome and EigenLayer AVS ecosystems.

• Aligned Incentives: Protocol revenue directly funds user growth loops.
• Reduced Speculative Capture: Governance reflects utility, not just capital.

Decouples the expensive voting action from the final execution. Governance becomes a coordination layer, not a gas auction.

• Gasless voting for all participants via signed messages.
• Execution strategies (like SafeSnap) use a relayer to submit the final, verified result on-chain.
• Dominant market share: Used by $10B+ in protocol treasuries for governance.

Moves the entire governance process to a low-cost Layer 2, with a fraud-proof window for disputes. Makes frequent, small proposals economically viable.

• Arbitrum's Governor L2 executes on L1 only after a 7-day challenge period.
• Reduces proposal cost from ~$50k+ on Ethereum L1 to ~$10 on Arbitrum.
• Preserves sovereignty: Final execution still secured by Ethereum.

Allows protocols to sponsor gas fees for specific user actions, like voting. Turns gas from a user problem into a protocol acquisition cost.

• Paymaster contracts abstract gas, paid in any token (or by the DAO itself).
• Enables one-click governance participation without holding the native token.
• Critical for onboarding: Removes the final UX hurdle for token-weighted voting.

Reduces on-chain transaction load by professionalizing delegation. One delegate's vote represents thousands of token holders, amortizing gas costs.

• Aggregates voting power into expert delegates, reducing total transactions needed.
• Transparent track records and tools for delegates to justify their votes.
• Mitigates voter apathy: Small holders can delegate influence without cost.

Priority fee auctions create a pay-to-play system that excludes retail users and small bots. This centralizes block production power to the highest bidders, undermining decentralization.

• Result: MEV searchers and whales dominate transaction ordering.
• Impact: Front-running and sandwich attacks become systemic, not incidental.

Shift from specifying how (complex transactions) to declaring what (desired outcome). This abstracts gas complexity to specialized solvers.

• Example: Users submit intents to UniswapX or CowSwap.
• Benefit: Solvers compete on execution quality, not just speed, improving price and reducing failed tx cost.

High base-layer fees create a misalignment. Validators profit from congestion, disincentivizing scalability upgrades that reduce their revenue.

• Evidence: Proposals for large block size increases often face validator opposition.
• Risk: Protocol development is held hostage by miner extractable value (MEV).

Decouple execution from consensus. Rollups (Arbitrum, Optimism) and shared sequencers (like Espresso, Astria) separate fee markets, breaking L1 validator monopoly.

• Mechanism: Users pay for execution on a dedicated layer with its own governance.
• Outcome: Faster, cheaper blocks without requiring L1 consensus changes.

Spikes during NFT mints or airdrops make cost forecasting impossible for businesses. This isn't just expensive—it's operationally paralyzing.

• Consequence: Dapps cannot guarantee user experience or operational costs.
• Real Cost: Failed transactions and abandoned wallets represent massive economic waste.

Let applications manage gas economics. ERC-4337 and Paymasters allow dapps to sponsor fees, use stablecoins, or implement subscription models.

• Who's Doing It: Stackup, Biconomy, Candide.
• Governance Win: Transfers fee policy control from the chain to the application layer.