Arbitrum One has activated Priority Gas Auctions, replacing its Timeboost transaction-ordering system with per-transaction bidding through standard EIP-1559 priority fees. The change gives users and applications a direct mechanism for competing for earlier execution by setting a maxPriorityFeePerGas on individual transactions. The new ordering policy went live on September 24 after approval through ArbitrumDAO governance.
The system was defined through the constitutional AIP governing the transition from Timeboost to PGA. Arbitrum One’s 250-millisecond block cadence is divided into two nominal 125-millisecond auction rounds, with queued transactions ranked primarily by effective priority fee and ties settled according to arrival time at the sequencer.
Priority Fees Now Determine Ordering Competition
Transactions arriving during an active auction round wait for the next round before entering the sequencer’s private mempool. At the start of each round, eligible transactions are sorted by their effective priorityFeePerGas, with higher bids receiving earlier ordering. The mechanism replaces Timeboost’s ahead-of-time express-lane auction with a just-in-time competition attached directly to each transaction.
That distinction removes the need for market participants to compete for a 60-second express lane through specialized Timeboost infrastructure. Offchain Labs argued that the earlier design had become difficult for latency-sensitive systems such as propAMMs, arbitrage strategies and other applications requiring frequent priority inclusion. PGA instead uses fee mechanics already familiar across EVM infrastructure, lowering the technical barrier to competing for transaction priority.
Paying the highest priority fee does not create an unconditional inclusion guarantee. Blocks remain subject to gas and calldata limits, while low-fee transactions that remain queued receive a virtual priority boost after each auction round. The anti-starvation mechanism is designed to move transactions with low or zero tips toward inclusion over subsequent rounds without charging users the value of that virtual boost.
Arbitrum also retains a private sequencer mempool. Transactions are not publicly exposed before their ordering has been determined, which Offchain Labs says preserves the network’s existing protection against conventional public-mempool sandwiching and frontrunning. The move changes how users compete for sequencing priority without turning Arbitrum One into an Ethereum-style public mempool. The broader importance of governance controls over Arbitrum infrastructure has also surfaced through previous decisions involving emergency network authority.
Timeboost Gives Way to a New Revenue Model
Timeboost launched in April 2025 and sold temporary express-lane access that allowed the winning participant to bypass a delay applied to ordinary transactions. The PGA activation eliminates that express lane and its associated delay on Arbitrum One. Transaction-priority revenue now comes from individual priority fees rather than periodic Timeboost auction bids.
Under the approved framework, 97% of PGA proceeds are allocated to the ArbitrumDAO Treasury and 3% to the Arbitrum Developer Guild. Those proceeds are intended to be accounted for publicly and distributed through separate DAO votes approximately every six months. The ordering change therefore modifies both transaction execution economics and how Arbitrum captures revenue from demand for latency.
The PGA rollout also coincides with Fast Feed, a separate paid service that exposes ordered sequencer data to subscribers before the standard completed-block feed. Fast Feed does not determine transaction order; it provides faster visibility once ordering has been established. Together, the two systems separate the market for transaction priority from the market for low-latency data access. Similar questions around transaction propagation, ordering and execution predictability are becoming more prominent as Ethereum develops parallel-execution and block-construction changes.
The next concrete milestone is performance under sustained production activity. Priority-fee levels, low-fee transaction inclusion times, auction participation and DAO revenue will show whether PGA produces a broader and more efficient ordering market than Timeboost. With the system now live, the question has moved from governance approval to how wallets, trading applications and latency-sensitive infrastructure adapt their fee strategies to Arbitrum One’s new ordering rules.