What is Taiyi?

The current PBS model in Ethereum necessitates a just-in-time competition among block builders for each block. This auction process, lasting approximately 12 seconds, introduces significant latency in transaction confirmations, degrading user experience and limiting Ethereum’s potential for high-frequency applications.

The key issue in Ethereum’s gas fee market is the absence of effective hedging solutions, primarily due to the lack of natural sellers for future blockspace. Without the ability to hedge against these fluctuations, users and applications face significant uncertainty in transaction costs, and the ecosystem lacks the sophisticated financial instruments necessary for a mature and stable market.

Block builders, by maintaining private order flows, circumvent true price discovery for blockspace within individual blocks. This opacity in pricing mechanisms leads to market inefficiencies and potentially unfair advantages for certain participants.

As of October 2024, the top two block builders are responsible for constructing over 95% of blocks. This concentration of power significantly undermines Ethereum’s fundamental value proposition of censorship resistance and decentralization.

Bootstraping new validator set for based rollups presents a significant challenge. The process of bootstrapping a new network of validators is time-consuming and resource-intensive. This “cold start” problem can be a major hurdle for new based rollups, slowing down their launch.

Taiyi significantly reduces confirmation times by introducing a preconfirmation mechanism. This allows transactions to be confirmed before they are included in a block, effectively eliminating the 12-second block time delay. Users can receive near-instant transaction confirmations, drastically improving the Layer 1 experience and enabling high-frequency applications directly on Ethereum’s base layer.

Taiyi leverages validators, the natural producers of blockspace, to create a robust marketplace for future blockspace. This paradigm shift introduces a perfect natural hedge against gas fee volatility, addressing a critical pain point for users and applications. By enabling validators to sell their future blockspace directly, Taiyi creates a win-win scenario: users gain access to predictable transaction costs and effective hedging instruments, while validators unlock new revenue streams, enhancing their economic incentives within the Ethereum ecosystem.

Taiyi introduces a fungible preconfirmation for blockspace trading, enabling price discovery to occur in a permissionless and open market. This allows for the trading of both absolute positioning (e.g., top of block) and relative positioning (e.g., an arbitrage after a swap transaction) of blockspace between dynamic buyers and sellers. By facilitating this open trading environment, Taiyi promotes transparent price discovery and enhances censorship resistance properties, addressing the opacity issues present in current blockspace markets.

Taiyi significantly improves Ethereum’s censorship resistance by decentralizing the block production process. Unlike the current system where a single block builder dominates, Taiyi enables free trading and exchange of blockspace among multiple dynamic parties. This decentralization increases the cost and difficulty of censorship.

Taiyi solves the cold start problem for based rollups by providing a reusable validator set. This allows new rollups to leverage Taiyi’s existing network of validators, significantly reducing deployment time and costs. Built-in delegation mechanism allows validators to delegate L2 block building to “superbuilders” from day 1, significantly the time needed to provide optimal UX.