While organizing the ledgers, I noticed again that cross-period arbitrage I had abandoned because the fees were too high. The wear-and-tear cost of privacy transactions has always been a pain point. Recently, I studied the Dusk Network testnet and found that in its confidential settlement process (XSC), there is a fixed high-Gas estimation mechanism—this design directly affects the capital efficiency of high-frequency traders.
Why does settlement pre-collect such a high fee? Dusk doesn’t just use simple signatures; the entire transaction is locked inside homomorphic encryption. During settlement, nodes must resolve multiple ZK proofs; if computational power is insufficient, the consensus layer will intercept it during the packing window. Without this fee-rate barrier, attackers could launch massive dust transactions, paralyze the network, and profit from shorting before the system collapses. The high fee rate provides enough cost to block malicious congestion.
But there are a few blind spots in the execution details. The compute resources are currently limited to a constrained allocation set; they’re not open to elastic scaling. The fee parameter is controlled by a small group of governance actors, and ordinary users almost never take on a high privacy premium for small spot trades. In real operation, you still rely on those few dozen block-producing nodes not getting congested or refusing to raise prices. Also, during the queue time waiting to be packed, the funding rate for cross-period arbitrage continues to accrue interest. When the market is highly volatile, the profit window may turn against you—MEV bots will snatch the risk-free gains, not you.
@Dusk_Foundation privacy settlement—I really approve of it. Native traffic-blocking attacks really are impressive. But for hiding transfers by keeping funds stuck in a high-fee queue process, how is that accounted for? $DUSK will the economic model introduce a dynamic fee-reduction mechanism in the future? #dusk Whether the architecture runs is one thing; after the mainnet goes live, the network’s real congestion cost and how much retail users can bear are another.
Real industry-changing progress takes time to accumulate. I’ll keep monitoring on-chain data destruction, but in my mind that question still hasn’t been resolved: if block-producing node resources aren’t sufficiently decentralized, can the assumptions of this trustless privacy model still hold?
Why does settlement pre-collect such a high fee? Dusk doesn’t just use simple signatures; the entire transaction is locked inside homomorphic encryption. During settlement, nodes must resolve multiple ZK proofs; if computational power is insufficient, the consensus layer will intercept it during the packing window. Without this fee-rate barrier, attackers could launch massive dust transactions, paralyze the network, and profit from shorting before the system collapses. The high fee rate provides enough cost to block malicious congestion.
But there are a few blind spots in the execution details. The compute resources are currently limited to a constrained allocation set; they’re not open to elastic scaling. The fee parameter is controlled by a small group of governance actors, and ordinary users almost never take on a high privacy premium for small spot trades. In real operation, you still rely on those few dozen block-producing nodes not getting congested or refusing to raise prices. Also, during the queue time waiting to be packed, the funding rate for cross-period arbitrage continues to accrue interest. When the market is highly volatile, the profit window may turn against you—MEV bots will snatch the risk-free gains, not you.
@Dusk_Foundation privacy settlement—I really approve of it. Native traffic-blocking attacks really are impressive. But for hiding transfers by keeping funds stuck in a high-fee queue process, how is that accounted for? $DUSK will the economic model introduce a dynamic fee-reduction mechanism in the future? #dusk Whether the architecture runs is one thing; after the mainnet goes live, the network’s real congestion cost and how much retail users can bear are another.
Real industry-changing progress takes time to accumulate. I’ll keep monitoring on-chain data destruction, but in my mind that question still hasn’t been resolved: if block-producing node resources aren’t sufficiently decentralized, can the assumptions of this trustless privacy model still hold?