Protocol Mechanics
Core mechanisms ensuring MegaETH's security, reliability, and economic sustainability.
Fee Model
MegaETH is designing an "original" approach to sequencer revenue distribution:
Current state: Sequencer collects ETH from transaction fees
Options being considered:
Token buyback (benefits MegaETH holders)
Ecosystem funding (supports builders)
Hybrid models balancing multiple goals
Challenge: Balancing MegaETH token economics with Ethereum community alignment
Timeline: Model still being finalized with focus on long-term sustainability
The team emphasizes creating innovative incentive models rather than copying existing approaches.
Discussion: https://x.com/GreenGeorgeHL/status/1912223926702264428
Reorg Handling
While extremely rare today, MegaETH's reorg risk will further decrease with future ZK implementation:
Current (Optimistic) model:
7-day challenge period creates reorg window
L1 reorganization forces L2 to follow
Sequencer misbehavior theoretically possible
Future (ZK) model:
Near-instant finality once proof hits L1
Reorgs only possible in narrow window (execution → proof submission)
L1 reorgs still require L2 to follow
Protection strategy today:
Sequencer economically and socially motivated to behave correctly
All infrastructure components built to handle potential reorgs
Automatic detection and response to L1 reorgs
"Have a plan" philosophy - robust but not routine
With ZK transition: Reorg risk drops from "extremely unlikely" to "virtually impossible" except for L1 reorgs themselves.
Technical approach: https://x.com/yangl1996/status/1913282712254771597
Sequencer Dynamics
MegaETH implements hot backup system for zero-downtime operations:
How it works:
Primary sequencer broadcasts progress continuously
Hot backups track every block in real-time
On failure, backup takes over within tens of milliseconds
New sequencer resumes exactly where previous stopped
Key innovation: Instead of asking "where did you stop?" during crisis, backups already know through continuous tracking. This flips the traditional handoff model for instant recovery.
Performance considerations:
Switching sequencers pauses chain briefly
Ethereum rotates every block (12s) - good for decentralization
MegaETH rotates only on failure - optimized for consistent 10ms blocks
Trade-off: Less frequent rotation for better performance
Benefits:
Hardware failures recovered automatically
Upgrades without downtime
Foundation for future multi-sequencer model
Maintains real-time performance
Implementation details: https://x.com/megaeth_labs/status/1927748927744282948
Security Model
MegaETH's security relies on multiple layers:
Ethereum anchoring: Ultimate security from L1
Fraud proofs: 7-day challenge period (current)
ZK proofs: Near-instant finality (future upgrade)
Economic incentives: Sequencer staking and slashing
Operational resilience: Hot backups and monitoring
Data availability: EigenDA with operator incentives
These mechanisms create a robust protocol supporting real-time applications without compromising security.
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