Happy to see a large support so far on prop 862 to urgently fund the operators following a spike in gas fees. I am opening a discussion here on the topic of IBC relayer’s operation issues brought up in the following topic by @Ertemann
This discussion is not a duplicate of the IBC relayer gas cost restitution plan but rather an attempt at exploring how we can design long term solutions for this critical piece of the IBC ecosystem and how AADAO specifically can help achieve the desired outcomes.
I’m personally very interested in knowing more about the operational challenges IBC relayers are facing in the day to day and how AADAO could potentially help in that context, either by simply providing a direct financial help (like we did with the ICS testnet group) or by funding an initiative that will fix the issue at its core, making IBC relaying sustainable (and why not attractive for operators) in the longer run.
I also believe there is probably a world in which we could make IBC relaying both sustainable and aligned-value accretive for ATOM. Carter has shared some initial thoughts on how ATOM could benefit from a strong positioning at the relayer infra level.
My summarized understanding of how IBC relaying currently works in Cosmos
Relayer operations in the Interchain involve transmitting data between different blockchains using IBC. Relayers listen for packets on one blockchain and post verifications for those packets on another. They are essential for trust-minimized asset and message transfers between networks. Currently, relayers pay the gas fees for these transactions, often operating at a loss as a public service to the interchain. ATOM’s integration into this system is primarily as the transaction fee currency on the Cosmos Hub, which relayers use to pay for the gas fees incurred during relaying operations.
I’ve done some preliminary research and I am introducing here a few suggestions (apologies if they have already been suggested on the other topic)
Some long-term solutions
- Integrate relayer costs into transaction fees: Implement a system where a portion of transaction fees directly compensates relayers. This creates a self-sustaining model where relayers are funded by the transactions they facilitate.
- Develop a Relayer Reward Mechanism with ATOM: Establish a reward system where relayers earn ATOM for their operations. This incentivizes the use of ATOM and integrates it deeply into the relaying process.
- Promote exclusive use of ATOM in IBC relaying: Encourage agreements within Cosmos that prioritize or exclusively use ATOM for relaying fees and operations.
Also super happy to do a working session with a few relayers to explore how we can move forward.