Latent Urgency Factors on Ethereum

The Ethereum Urgency Score we introduce in the recent working paper "Ethereum Urgency Score" summarises how intensely wallets compete for execution: through higher gas fees, unusual timing, large trades, and interactions with rare contracts or assets. To better understand how urgency behaves at the system level, we extract two latent factors from all Ethereum transactions between 2022 and 2023:

• PC1 – Rarity-driven urgency: captures interactions with rare assets, specialized smart contracts, and unusual counterparties.
• PC2 – Execution-intensity urgency: captures timing pressure, high gas bidding, and unusually large transaction sizes.

The chart below plots these two factors over time and aligns them with major crypto events, including the Terra/Luna collapse, the Ethereum Merge, the FTX collapse, and the USDC de-peg. Spikes and sharp reorganizations of the factors highlight periods when on-chain behavior becomes stressed, coordinated, or information-driven.

In calm periods, both factors remain close to zero, indicating stable execution behavior and a diversified set of contract paths and counterparties. During stress episodes, however, urgency converges: wallets route through similar contracts, pay higher fees, or move through rare and specialized pathways. This makes the latent urgency factors a compact, real-time indicator of liquidity pressure and information flow in the Ethereum ecosystem.