On-chain competition refers to the direct rivalry among participants or protocols operating directly on a blockchain network for resources, transaction inclusion, or market share. This can manifest as bidding for block space, competition among decentralized exchanges for liquidity, or validators vying for block production rights. It drives efficiency and innovation within decentralized environments. Such competition influences network fees.
Context
News often reports on the dynamics of on-chain competition, particularly concerning transaction fees during periods of high network activity. Decentralized finance protocols actively compete for user funds and trading volume through various incentive programs. This competition is a constant force shaping the economic models and user experiences within blockchain ecosystems.
A game-theoretic model formalizes MEV-Boost auctions, demonstrating how latency and strategic bidding, not maximal value, drive block selection, quantifying auction inefficiency.
Tapzi's skill-to-earn model, validated by audited smart contracts, establishes a transparent competitive layer for gaming, enhancing user acquisition and retention in the decentralized application ecosystem.
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