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Transaction pricing models

Arthera accomodates two transaction models:

  • The usual Pay-Per-Use or Pay-as-You-Go model, used on Ethereum, where users pay for each transaction.

  • A SaaS transaction model, where a 3rd party dApp can pay a stable subscription cost in advance to cover for their users transaction gas price.

Pay-per-use​

Aka Pay-as-You-Go mode. This is the standard operating mode of Arthera for accounts that don't have an active subscription or for which their subscription reached its cap.

Every transaction will incur gas costs for the sender, which means the sender needs to have a positive balance of AA in his wallet, otherwise the transaction will be reverted.

Gas fee rebates​

Since Arthera is a sustainable ecosystem, our Pay-as-You-Go mode comes with a rebate mechanism, returning part of the individual gas cost incurred by the network to the dApp.

Every contract account on Arthera can opt-in for gas-fee rebates by registering their address and a fee receiver account in a special system contract.

The registered fee receiver will get 10% of the gas fees spent by EOAs that send transactions to the registered contract account.

Subscriptions​

Subscription business models are based on the idea of selling a product or service to receive monthly or yearly recurring subscription revenue. They focus on customer retention over customer acquisition. In essence, subscription business models focus on the way revenue is made so that a single customer pays multiple payments for prolonged access to a service instead of a large upfront one-time price.

The economy is trending toward more subscriptions instead of ownership for cars, software, entertainment, and shopping, increasing the lifetime value (LTV) of the customer.

Subscriptions are the enabler for the Software as a Service (SaaS) licensing and delivery model, where a piece of software is licensed on a subscription or perpetual licence basis. SaaS apps are typically accessed by users of a web browser (a light client) or mobile app, and quickly became the preferred business model for all tech startups.

In Arthera, subscriptions are built into the core protocol and they determine how gas is being spent by an account (EOA or Contract).


Subscription Plans​

Subscriptions are always based on a Subscription Plan that defines the terms and conditions of the subscription:

  • if it's an EOA or a Contract plan
  • the subscription period in days
  • the number of gas units included
  • the price in USD
  • a hourly/daily cap of gas that can be consumed

Each Subscription Plan has a unique identifier in the network. The initial plans will be proposed by Arthera and will change over time using governance. The hourly/daily cap was introduced as a rate-limit to prevent gas hogging. When the cap is reached, the subscriber needs to wait for the cap to reset in order to use the subscription again. If the cap is maxed out, the account will work in a Pay-as-You-Go mode, paying gas fees for each transaction, similar to traditional blockchains.

An account in Arthera can have a single subscription. The subscription can be cancelled, renewed, upgraded, downgraded, traded and rented. It has the following attributes:

  • an owner (EOA or Contract account)
  • the current subscription plan
  • the balance, initially set to number of gas units in the active plan
  • when the subscription started
  • when the subscription will end

Subscriptions are optional and an account that doesn't have an active subscription will work in Pay-as-You-Go mode, paying gas fees for each transaction, similar to traditional blockchains.

Upon purchase, the subscription becomes immediately active and will stay that way as long as:

  • its balance is positive
  • its end date is after the current block time

If any of the above two conditions are not met anymore, the subscription becomes inactive. An inactive subscription can be renewed anytime, topping up its balance and end date.

If an account cancels or transfers the subscription to another account, the account will no longer have a subscription. Arthera has two types of accounts: Externally Owned Accounts (EOAs) and Contract Accounts (DApps). Subscriptions work differently for each type.

EOA Subscriptions​

Externally Owned Account (EOA) subscriptions are also called User subscriptions because users own EOAs. An EOA is an account controlled by anyone that holds the private keys for the account. It has the following distinctive features:

  • it doesn't cost anything to create
  • it can initiate transactions
  • transactions between EOAs only be AA/Token/NFT transfers
  • gas fees are always paid by EOA that originated the transaction
  • is made up of a cryptographic pair of keys: public and private keys that control account activities

If an EOA has an active subscription, gas fees will be deducted from the subscription balance. If the subscription becomes inactive, the EOA will work in Pay-as-You-Go mode.

When sending transactions from an EOA to a Contract account that has an inactive subscription, the EOA will be charged in Pay-as-You-Go mode, even if the EOA has an active subscription.

The EOA's subscription only works with Contract accounts that have no subscription (never purchased a subscription).

This is intentional because EOA subscriptions should not supersede a DApp subscription. Once a DApp get a subscription, it's the DApp's responsibility to manage the experience for their users.

EOA subscriptions were designed for Arthera end-users that don't want to worry about gas fees and want to have a predictable monthly cost. EOA subscriptions are priced in USD and their price can be changed only through governance. For the time being, the starting point is the 1$ EOA monthly subscription which gives an EOA enough gas fees to:

  • make 30 AA transfers
  • make 30 ERC20 token transfers
  • make 30 ERC721 token transfer
  • make 30 ERC1155 token transfers

That's a pretty good deal for 1$/month.

Contract subscriptions​

A Contract account is a smart contract deployed to the network that is controlled by code. It has the following distinctive features:

  • creating (deploying) a contract has a cost because you're using network storage
  • running contract code has a cost because you're using network CPU and memory
  • can only send transactions in response to receiving a transaction
  • transactions from an EOA to a contract account can trigger code which can execute many actions, such as transferring tokens or even creating a new contract.
  • gas fees are paid either by the EOA that originated the transaction or by the contract itself if it has an active subscription
  • doesn't have private keys. Instead, it is controlled by the logic of the smart contract code

Contract subscriptions work differently than EOA subscriptions. A Contract subscription is meant to waive gas fees for EOAs that send transactions to the contract account if the EOA is whitelisted to use the contract's subscription. This has major implications, because the cost of transactions is moved from the EOA to the contract.

As long as the contract has an active subscription, and an EOA is whitelisted to use the contract's subscription, the EOA that transacts with the contract doesn't pay anything. In layman terms, this means that an EOA can work with a DApp without owning AA, opening up an entire range of use-cases for DApps and end-users.

A DApp can choose to charge its users in a different way, using any payment method: fiat money, cards or give access to its services for free. Contract subscriptions can also be packed in bundles by resellers, offering access to a range of services using competitive pricing.

DApp subscription plans work in tiers of discounts, with gas prices being cheaper for larger amounts of units purchased.

Caps​

Certain subscription plans might impose hourly or daily usage caps to prevent malicious behavior. Caps are set in number of gas units allowed to be consumed in a time frame and work like a rate-limiter. When the cap is reached for a subscription, the subscriber will be switched to Pay-as-You-Go until the cap is reset.

Cap windows are measured using block times, to be consistent across the network.

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Latest update: October 2, 2023