Flashbots stated that MEV bots are clogging blockchains at a rate faster than the networks’ scalability. MEV – related spam continues to take up a large portion of block space, and a new system is needed to achieve true on – chain scalability.
MEV, short for “Miner – Extractable Value”, is a by – product of blockchain design. It refers to the value that miners or validators can extract by leveraging their ability to prioritize, include, or reorder transactions. MEV bots are programs that execute profit – maximizing strategies by taking advantage of arbitrage opportunities in blockchain transactions.
The clogging of blockchains by MEV bots leads to several negative consequences. For one thing, it causes network congestion, which significantly affects the user experience of decentralized applications, resulting in higher gas fees, slippage, and potential risks of validator collusion and centralization. For another, the current MEV extraction methods create an incentive system that poses an existential risk to the consensus security of blockchains.
Flashbots is a research and development organization established to mitigate the negative externalities and existential risks brought about by MEV to smart – contract – platform – type blockchains. They have proposed a trustless, transparent, and fair ecosystem for MEV extraction to safeguard the principles of Ethereum. To address the problem of MEV bots clogging blockchains, Flashbots has taken a series of measures, such as developing MEV – Inspect and MEV – Geth.
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