Offchain Labs co-founder Edward Felten has called for layer-2 networks built on Ethereum to adopt what he terms ‘responsive pricing’ if they are to serve billions of users and smooth out the fee spikes that accompany network congestion. Felten made the remarks during a keynote address at EthCC 2026, where he argued that gas-price volatility remains the primary mechanism for shielding networks from overload during periods of heavy demand. While that approach offers a form of protection, it produces the kind of unpredictable costs that mainstream users tend to find unacceptable.
The backdrop to Felten’s remarks is Ethereum’s existing fee structure, shaped by the EIP-1559 upgrade introduced in August 2021 as part of the London hard fork. That upgrade reformed the gas fee market by adjusting the gas fee limit and introduced a mechanism that permanently removes a portion of transaction fees from circulation. Despite those changes, fee volatility has persisted, particularly during congestion, and has long been cited as a barrier to broader adoption among users accustomed to stable costs in traditional financial systems.
The scaling challenge for Ethereum’s layer-2 ecosystem has shifted beyond simply adding throughput. The central question is now whether these networks can make transaction costs predictable enough for consumer-facing applications while still pricing congestion in a way that protects infrastructure under heavy load. Arbitrum One adopted a dynamic pricing model in January, describing it as a platform direction aimed at making fees more predictable under demand by aligning prices with real network bottlenecks. Felten presented charts at EthCC showing that Arbitrum gas fees remained lower during peak volumes than those on the Base network and other layer-2s that continue to rely on EIP-1559.
Arbitrum One is currently the largest layer-2 network by total value locked, holding $15.2 billion, while Coinbase’s Base Chain ranks second at $10.9 billion, according to data from L2beat. Across all layer-2 networks, cumulative total value locked stands at over $39.7 billion, representing a 4.6% increase over the past year. Arbitrum’s dynamic pricing rollout is now considered one of the first live tests of the tradeoff between fee predictability and real-time cost alignment.
Not everyone views responsive pricing as a straightforward improvement. Julian Kors, a senior developer and founder of execution workspace startup Pulsar Spaces, told Cointelegraph that the model’s main drawback is lower predictability compared to EIP-1559. He framed the debate not as one model being superior to the other, but as a choice between optimising for predictability and mechanism design purity on one hand, or efficiency and real-time cost alignment on the other, noting that EIP-1559 excels at the former while responsive pricing leans toward the latter.
Jerome de Tychey, president of Ethereum France and EthCC, said responsive pricing could improve the user experience by making fees more accurately reflect actual network demand. Cyprien Grau, project lead at gasless Ethereum layer-2 Status Network, described the new model as a genuine improvement in fee accuracy, though he noted that users could still face variable costs and gas spikes during congestion since the approach still relies on a fee market. Grau characterised responsive pricing as the most advanced iteration of the gas model, but argued that the gas model itself ultimately needs to be replaced, saying that layer-2 networks capable of reaching billions of users will be those where users never have to think about gas at all.
The fee model discussion is unfolding alongside a broader reassessment of Ethereum’s scaling strategy. In February, Ethereum co-founder Vitalik Buterin argued that some assumptions underpinning the rollup-centric scaling thesis no longer held, and that future scaling efforts should place greater reliance on the mainnet and native rollups. Layer-2 networks were originally conceived to offload transaction volume from the mainnet, but concerns have grown that these networks have drawn significant economic value away from Ethereum’s base layer, prompting a reconsideration of the ecosystem’s overall direction.
Originally reported by CoinTelegraph.
