Related papers: The Centralizing Effects of Private Order Flow on …
We study builder-driven MEV arbitrage on BNB Smart Chain (BSC). BSC's Proposer-Builder Separation (PBS) adopts a leaner design: only whitelisted builders can participate, blocks are produced at shorter intervals, and private order flow…
We investigate the welfare loss of continuous and discrete order matching models in blockchain-based decentralized exchanges (DEX) that utilize order books to record outstanding orders. Continuous processing matches each incoming…
We provide an economic model of Execution Tickets and use it to study the ability of the Ethereum protocol to capture MEV from block construction. We demonstrate that Execution Tickets extract all MEV when all buyers are homogeneous, risk…
In the context of decentralized blockchains, accurately simulating the outcome of order flow auctions (OFAs) off-chain is challenging due to adversarial sequencing, encrypted bids, and frequent state changes. Existing approaches, such as…
Ethereum's upcoming Glamsterdam upgrade introduces EIP-7732 enshrined Proposer--Builder Separation (ePBS), which improves the block production pipeline by addressing trust and scalability challenges. Yet it also creates a new liveness risk:…
Classical optimal auction theory assumes that bids reach the seller directly. We study how this picture changes when a revenue-maximizing intermediary controls access to the seller's auction. Motivated by blockchain auctions, online…
The successive generations of consensus algorithms have progressively shifted the performance bottleneck of blockchains to the execution layer. While recent works address this by parallelizing transaction execution, they often overlook the…
Blockchains protect an ecosystem worth more than $500bn with strong security properties derived from the principle of decentralization. Is today's blockchain decentralized? In this paper, we empirically studied one of the least…
Blockchains, and specifically smart contracts, have promised to create fair and transparent trading ecosystems. Unfortunately, we show that this promise has not been met. We document and quantify the widespread and rising deployment of…
We show that Execution Tickets and Execution Auctions dramatically increase centralization in the market for block proposals, even without multi-block MEV concerns. Previous analyses have insufficiently or incorrectly modeled the…
Block space on the blockchain is scarce and must be allocated efficiently through block building. However, Ethereum's current block-building ecosystem, MEV-Boost, has become highly centralized due to integration, which distorts competition,…
Multi-block MEV (MMEV) denotes the practice of securing k-consecutive blocks in an attempt at extracting surplus value by manipulating transaction ordering. Following the implementation of pro-poser/builder separation (PBS) on Ethereum,…
Traditional blockchain design gives miners or validators full control over transaction ordering, i.e., they can freely choose which transactions to include or exclude, as well as in which order. While not an issue initially, the emergence…
Proof-of-stake (PoS) is a promising approach for designing efficient blockchains, where block proposers are randomly chosen with probability proportional to their stake. A primary concern with PoS systems is the "rich getting richer"…
In blockchain systems, fair transaction ordering is crucial for a trusted and regulation-compliant economic ecosystem. Unlike traditional State Machine Replication (SMR) systems, which focus solely on liveness and safety, blockchain systems…
All public blockchains are secured by a proof of opportunity cost among block producers. For example, the security offered by proof-of-work (PoW) systems, like Bitcoin, is due to spent computation; it is work precisely because it cannot be…
Due to its minimal energy requirement the PoS consensus protocol has become an attractive alternative to PoW in modern cryptocurrencies. In this protocol the chance of being selected as a block proposer in each round is proportional to the…
Blockchains revolutionized centralized sectors like banking and finance by promoting decentralization and transparency. In a blockchain, information is transmitted through transactions issued by participants or applications. Miners…
We investigate the market microstructure of Automated Market Makers (AMMs), the most prominent type of blockchain-based decentralized exchanges. We show that the order execution mechanism yields token value loss for liquidity providers if…
Privacy-preserving cryptocurrency exchanges (shielded AMMs, batched swap auctions, sealed-bid order-flow auctions) alter what the pricing mechanism observes about order flow. We derive the unique linear Kyle equilibrium when a committed…