A Collective Effort in Bringing Transparency to MEV

MEV-explore came into existence to help reduce information asymmetry by shedding light on MEV activities. Thanks to the Flashbots core developers and community contributors to MEV-Explore and MEV-Inspect through v0 and v1.Georgios Konstantopoulos, Jason Paryani, Scott Bigelow, Taarush Vemulapalli, Gui Heise, Austin Williams, Robert Miller, Luke Van Seters, Danning Sui, Ryan Noble, Andrei Anisimov and Tom Schmidt.

If you would like to join us on our mission and to contribute to MEV-inspect, start here.

Frequently Asked Questions (FAQ)

❓ What is MEV?

MEV (Maximal Extractable Value) is the total value that can be extracted permissionlessly (i.e. without any special rights) from the re-ordering, insertion or censorship of transactions within a block being produced. As miners currently have the ultimate say on transaction ordering and inclusion in Ethereum, they can be seen as the most powerful player in this game, hence the commonly used term Miner Extractable Value. Yet, MEV exists on any blockchain and layers where there is a party responsible for transaction ordering (eg. validators, rollup providers).
Most of the MEV extracted on Ethereum today is captured by traders seizing opportunities where transaction ordering matters such as arbitrages and liquidations.

❓ Are you quantifying all MEV in this dashboard?

Most of the MEV extracted on Ethereum today is captured by traders seizing profit opportunities where transaction ordering matters such as arbitrages and liquidations. MEV-Explore focuses on quantifying the MEV extracted on-chain rather than quantifying the total MEV available in any given block. The Extracted MEV metric in the dashboard constitutes a lower bound on MEV, limited by the current set of DeFi protocols covered by our inspectors. See the Data & Metrics page for more details.

❓ Why MEV as Maximal Extractable Value instead of Miner Extractable Value?

On Ethereum today, and before it moves to proof-of-stake consensus, miners have the most power with respect to transaction inclusion and ordering as they are the block producers. Hence the term MEV was initially introduced as miner extractable value by Phil Daian et al. in the 2019 research paper Flashboys 2.0: Frontrunning, Transaction Reordering, and Consensus Instability in Decentralized Exchanges by Daian et. al.  However, MEV exists on all smart contract blockchains where there is a party responsible for transaction ordering, including non-miner actors such as validators in ETH2.0 and rollup providers on Optimistic Rollups. Therefore we propose to rename MEV as maximal extractable value, broadening the scope to cover other blockchain architectures, while still being ‘backwards compatible’ with its initial name (ie. hinting at the upper bound set by the rights of the most powerful actor with respect to transaction ordering).

Taking the word miner out of MEV’s name also addresses another common confusion: that miners are the only ones who capture this value. As mentioned above, the reality is that MEV extraction on Ethereum so far has been primarily conducted by non-mining DeFi traders and bot operators.

❓ Why MEV-Explore?

MEV is currently opaque to users of Ethereum. It requires significant data analysis and in-depth knowledge of smart contracts to understand as it involves transactions with complex, sometimes obfuscated, logic and adversarial games played on several meta-levels in the mempool, at times called the Dark Forest.

MEV-Explore is meant to help the community understand and quantify the significance of these activities and their impact on the Ethereum network. We aim to preserve Ethereum’s transparency by providing data that is accessible and comprehensible to every user.

We are taking a lower bound approach to quantifying MEV. There are more protocols to cover, more complex interactions to classify, and more useful data visualizations to create in order to bring the figures and data we show closer to the truth.

❓ What is Flashbots?

As more and more security-critical infrastructure moves off-chain, and as chain state and size grows, Ethereum’s opaqueness will only get worse and it will become increasingly difficult to leverage one of the original promises of cryptocurrency: transparency.

Flashbots is a research and development organization formed to mitigate the negative externalities and existential risks posed by miner-extractable value (MEV) to smart-contract blockchains. We propose a permissionless, transparent, and fair ecosystem for MEV extraction to reinforce the Ethereum ideals.

❓ Is Flashbots extracting MEV?

Flashbots does not actively participate in proprietary MEV extraction activities. Our efforts are currently centered around providing open-source example implementations and toolings for third-party MEV searchers within the Flashbots community.

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