From 865b7bcaffd92cde5924e90bac3c4e694e4a491f Mon Sep 17 00:00:00 2001 From: Abhishek Raj Date: Sat, 7 Sep 2024 21:46:03 +0530 Subject: [PATCH 1/5] Update content/developers/docs/mev/index.md Fix typo: "then used to then" -> "then used to" --- public/content/developers/docs/mev/index.md | 2 +- 1 file changed, 1 insertion(+), 1 deletion(-) diff --git a/public/content/developers/docs/mev/index.md b/public/content/developers/docs/mev/index.md index 24e43688d7d..01d8f13381a 100644 --- a/public/content/developers/docs/mev/index.md +++ b/public/content/developers/docs/mev/index.md @@ -52,7 +52,7 @@ It works like this: if two DEXes are offering a token at two different prices, s Lending protocol liquidations present another well-known MEV opportunity. -Lending protocols like Maker and Aave require users to deposit some collateral (e.g. ETH). This deposited collateral is then used to then lend out to other users. +Lending protocols like Maker and Aave require users to deposit some collateral (e.g. ETH). This deposited collateral is then used to lend out to other users. Users can then borrow assets and tokens from others depending on what they need (e.g. you might borrow MKR if you want to vote in a MakerDAO governance proposal) up to a certain percentage of their deposited collateral. For example, if the borrowing amount is a maximum of 30%, a user who deposits 100 DAI into the protocol can borrow up to 30 DAI worth of another asset. The protocol determines the exact borrowing power percentage. From d7fc612533a0de9ef85d5651c75a8b911bafadbb Mon Sep 17 00:00:00 2001 From: Abhishek Raj Date: Sat, 7 Sep 2024 23:17:11 +0530 Subject: [PATCH 2/5] Update content/developers/docs/mev/index.md 1. Fix grammar 2. Add reference resource --- public/content/developers/docs/mev/index.md | 2 +- 1 file changed, 1 insertion(+), 1 deletion(-) diff --git a/public/content/developers/docs/mev/index.md b/public/content/developers/docs/mev/index.md index 01d8f13381a..b5149de2c75 100644 --- a/public/content/developers/docs/mev/index.md +++ b/public/content/developers/docs/mev/index.md @@ -122,7 +122,7 @@ As explained, MEV has negative implications for overall user experience and cons In post-Merge Ethereum, validators (having made security deposits of 32 ETH) come to consensus on the validity of blocks added to the Beacon Chain. Since 32 ETH may be out of the reach of many, [joining a staking pool](/staking/pools/) may be a more feasible option. Nevertheless, a healthy distribution of [solo stakers](/staking/solo/) is ideal, as it mitigates the centralization of validators and improves Ethereum’s security. -However, MEV extraction is believed to be capable of accelerating validator centralization. This is partly because, as validators [earn less for proposing blocks](/roadmap/merge/issuance/#how-the-merge-impacts-ETH-supply) than miners previous did, MEV extraction has greatly [influence validator earnings](https://github.com/flashbots/eth2-research/blob/main/notebooks/mev-in-eth2/eth2-mev-calc.ipynb) since The Merge. +However, MEV extraction is believed to be capable of accelerating validator centralization. This is partly because, as validators [earn less for proposing blocks](/roadmap/merge/issuance/#how-the-merge-impacts-ETH-supply) than miners previously did, MEV extraction has greatly [influenced validator earnings](https://github.com/flashbots/eth2-research/blob/main/notebooks/mev-in-eth2/eth2-mev-calc.ipynb) since [The Merge](https://ethereum.org/en/roadmap/merge/). Larger staking pools will likely have more resources to invest in necessary optimizations to capture MEV opportunities. The more MEV these pools extract, the more resources they have to improve their MEV-extraction capabilities (and increase overall revenue), essentially creating [economies of scale](https://www.investopedia.com/terms/e/economiesofscale.asp#). From 7577d9246d15e54afcfe103713909936e5e4791e Mon Sep 17 00:00:00 2001 From: Abhishek Raj Date: Sat, 7 Sep 2024 23:20:33 +0530 Subject: [PATCH 3/5] Update content/developers/docs/mev/index.md (Add resource links) Add relevant links as resources --- public/content/developers/docs/mev/index.md | 4 ++-- 1 file changed, 2 insertions(+), 2 deletions(-) diff --git a/public/content/developers/docs/mev/index.md b/public/content/developers/docs/mev/index.md index b5149de2c75..3ff0f4f4eb5 100644 --- a/public/content/developers/docs/mev/index.md +++ b/public/content/developers/docs/mev/index.md @@ -136,13 +136,13 @@ In response to sandwiching and frontrunning attacks, traders may start conductin Permissioned mempools would also accelerate the centralization risks described in the previous section. Large pools running multiple validators will likely benefit from offering transaction privacy to traders and users, increasing their MEV revenues. -Combating these MEV-related problems in post-Merge Ethereum is a core area of research. To date, two solutions proposed to reduce the negative impact of MEV on Ethereum’s decentralization and security after The Merge are **Proposer-Builder Separation (PBS)** and the **Builder API**. +Combating these MEV-related problems in post-Merge Ethereum is a core area of research. To date, two solutions proposed to reduce the negative impact of MEV on Ethereum’s decentralization and security after The Merge are [**Proposer-Builder Separation (PBS)**](https://ethereum.org/en/roadmap/pbs/) and the [**Builder API**](https://github.com/ethereum/builder-specs). ### Proposer-Builder Separation {#proposer-builder-separation} In both proof-of-work and proof-of-stake, a node that builds a block proposes it for addition to the chain to other nodes participating in consensus. A new block becomes part of the canonical chain after another miner builds on top of it (in PoW) or it receives attestations from the majority of validators (in PoS). -The combination of block producer and block proposer roles is what introduces most of the MEV-related problems described previously. For example, consensus nodes are incentivized to trigger chain reorganizations in time-bandit attacks to maximize MEV earnings. +The combination of block producer and block proposer roles is what introduces most of the MEV-related problems described previously. For example, consensus nodes are incentivized to trigger chain reorganizations in [time-bandit attacks](https://www.mev.wiki/attack-examples/time-bandit-attack) to maximize MEV earnings. [Proposer-builder separation](https://ethresear.ch/t/proposer-block-builder-separation-friendly-fee-market-designs/9725) (PBS) is designed to mitigate the impact of MEV, especially at the consensus layer. PBS’ major feature is the separation of block producer and block proposer rules. Validators are still responsible for proposing and voting on blocks, but a new class of specialized entities, called **block builders**, are tasked with ordering transactions and building blocks. From 3a5efb02c25c307f255503d2e037bf2e6bbe9b11 Mon Sep 17 00:00:00 2001 From: Corwin Smith Date: Mon, 16 Sep 2024 12:52:55 -0600 Subject: [PATCH 4/5] Update public/content/developers/docs/mev/index.md --- public/content/developers/docs/mev/index.md | 2 +- 1 file changed, 1 insertion(+), 1 deletion(-) diff --git a/public/content/developers/docs/mev/index.md b/public/content/developers/docs/mev/index.md index 3ff0f4f4eb5..03524e617b1 100644 --- a/public/content/developers/docs/mev/index.md +++ b/public/content/developers/docs/mev/index.md @@ -122,7 +122,7 @@ As explained, MEV has negative implications for overall user experience and cons In post-Merge Ethereum, validators (having made security deposits of 32 ETH) come to consensus on the validity of blocks added to the Beacon Chain. Since 32 ETH may be out of the reach of many, [joining a staking pool](/staking/pools/) may be a more feasible option. Nevertheless, a healthy distribution of [solo stakers](/staking/solo/) is ideal, as it mitigates the centralization of validators and improves Ethereum’s security. -However, MEV extraction is believed to be capable of accelerating validator centralization. This is partly because, as validators [earn less for proposing blocks](/roadmap/merge/issuance/#how-the-merge-impacts-ETH-supply) than miners previously did, MEV extraction has greatly [influenced validator earnings](https://github.com/flashbots/eth2-research/blob/main/notebooks/mev-in-eth2/eth2-mev-calc.ipynb) since [The Merge](https://ethereum.org/en/roadmap/merge/). +However, MEV extraction is believed to be capable of accelerating validator centralization. This is partly because, as validators [earn less for proposing blocks](/roadmap/merge/issuance/#how-the-merge-impacts-ETH-supply) than miners previously did, MEV extraction has greatly [influenced validator earnings](https://github.com/flashbots/eth2-research/blob/main/notebooks/mev-in-eth2/eth2-mev-calc.ipynb) since [The Merge](/roadmap/merge/). Larger staking pools will likely have more resources to invest in necessary optimizations to capture MEV opportunities. The more MEV these pools extract, the more resources they have to improve their MEV-extraction capabilities (and increase overall revenue), essentially creating [economies of scale](https://www.investopedia.com/terms/e/economiesofscale.asp#). From 3661764821ea52572db2591871d060d4d46b9e94 Mon Sep 17 00:00:00 2001 From: Corwin Smith Date: Mon, 16 Sep 2024 12:53:19 -0600 Subject: [PATCH 5/5] Update public/content/developers/docs/mev/index.md --- public/content/developers/docs/mev/index.md | 2 +- 1 file changed, 1 insertion(+), 1 deletion(-) diff --git a/public/content/developers/docs/mev/index.md b/public/content/developers/docs/mev/index.md index 03524e617b1..b368dfc1b19 100644 --- a/public/content/developers/docs/mev/index.md +++ b/public/content/developers/docs/mev/index.md @@ -136,7 +136,7 @@ In response to sandwiching and frontrunning attacks, traders may start conductin Permissioned mempools would also accelerate the centralization risks described in the previous section. Large pools running multiple validators will likely benefit from offering transaction privacy to traders and users, increasing their MEV revenues. -Combating these MEV-related problems in post-Merge Ethereum is a core area of research. To date, two solutions proposed to reduce the negative impact of MEV on Ethereum’s decentralization and security after The Merge are [**Proposer-Builder Separation (PBS)**](https://ethereum.org/en/roadmap/pbs/) and the [**Builder API**](https://github.com/ethereum/builder-specs). +Combating these MEV-related problems in post-Merge Ethereum is a core area of research. To date, two solutions proposed to reduce the negative impact of MEV on Ethereum’s decentralization and security after The Merge are [**Proposer-Builder Separation (PBS)**](/roadmap/pbs/) and the [**Builder API**](https://github.com/ethereum/builder-specs). ### Proposer-Builder Separation {#proposer-builder-separation}