1. EVM Architecture & Gas Pricing Model
[FACT] The Ethereum Virtual Machine (EVM) is a stack-based runtime executing 256-bit bytecode instructions. Unlike Bitcoin's stateless UTXO model, Ethereum is a world computer with persistent global state:
- Storage (2^256 keys): Persistent on-chain state stored in a modified Merkle Patricia Trie. Storage writes (
SSTORE) are the most expensive operations on the network (up to 20,000 gas). - Memory & Stack: Ephemeral byte arrays that exist only during transaction execution and are cleared upon termination.
- Gas Metering: To prevent infinite loops and denial-of-service exploits (the Halting Problem), every EVM opcode costs an exact amount of "gas". If a transaction runs out of gas, execution reverts completely while the miner retains the spent gas fees.
2. Proof-of-Stake Consensus & Slashing Conditions
[FACT] Ethereum consensus operates via a hybrid protocol combining Casper FFG (finality gadget) and LMD-GHOST (fork-choice rule):
- Validators: Participants deposit 32 ETH into the official deposit contract to activate a validator node.
- Epochs & Slots: Time is divided into 12-second slots and 32-slot epochs (6.4 minutes). In each slot, a randomly chosen validator proposes a block, while committees of other validators attest to its validity. Finality is achieved when two consecutive epochs receive a 2/3 supermajority attestation.
- Slashing: Validators who commit provable protocol violations (e.g. proposing two different blocks for the same slot, or double-signing conflicting attestations) are slashed: a portion of their 32 ETH stake is permanently destroyed, and they are forcibly ejected from the network.
3. EIP-1559 Base Fee Burn & Deflationary Issuance
[FACT] Implemented in 2021, EIP-1559 replaced legacy first-price gas auctions with an algorithmic base fee that adjusts dynamically to target 50% block utilization (15M gas target, 30M max):
Crucially, the Base Fee is permanently burned, while users include a discretionary "Priority Tip" paid directly to block builders. If the volume of ETH burned via base fees exceeds the annual Proof-of-Stake validator issuance (~2.5% to 3.5%), the net supply of ETH contracts, making the asset mathematically deflationary.
4. EIP-4844 Blob Space & Rollup Data Availability
[FACT] In the modular rollup architecture, execution occurs off-chain on Layer 2s (Arbitrum, Optimism, Base, zkSync), while transactions are bundled and posted to Ethereum L1 for consensus and data availability.
Previously, rollups posted data to expensive L1 calldata. EIP-4844 (Proto-Danksharding) introduced ephemeral Data Blobs (~128 KB per blob, up to 6 blobs per block). Blobs carry their own independent fee market and are automatically pruned from node memory after ~18 days, reducing Layer 2 transaction costs by over 90%.
5. Restaking & EigenLayer Dynamics
[ANALYSIS] Restaking allows staked ETH or Liquid Staking Tokens (stETH, rETH) to be pledged as collateral to secure auxiliary networks called Actively Validated Services (AVSs)—such as oracle networks, bridges, and sidechains.
While restaking maximizes capital efficiency by generating composite yields, it introduces compounding slashing risks and systemic inter-protocol contagion if an underlying AVS suffers a cascading liquidation.