key takeaways
- The number of Ethereum blocks produced by OFAC-compliant MEV-Boost relays fell below the 50% threshold yesterday.
- The metric peaked at 79% on November 21 and has been steadily declining ever since.
- Unobjectionable relays like BloXRoute Max Profit and Ultra Sound Money have been taking market share from OFAC compliant relay Flashbots.
Share this article
The risks of censorship over the Ethereum block production industry are fading as OFAC compliant MEV-Boost relays continue to build fewer and fewer blocks.
a steady decline
Ethereum’s censorship issues are slowly improving.
According to MEV Watch data, the number of Ethereum blocks produced by OFAC-compliant MEV-Boost relays fell below the 50% threshold yesterday. On February 13, only 47% of the blocks were produced by such relays; today that number is 49%.
On August 8, 2022, the Office of Foreign Assets Control (OFAC) aggregate Ethereum-based privacy protocol Tornado Cash to its sanctions list, arguing that the program was being used to launder money. Major service providers like Circle and Infura immediately moved to the blacklist of Ethereum addresses associated with the protocol, as did Flashbots, an MEV research organization.
MEV means “Maximum Extractable Value”; the term refers to the arbitrage of on-chain trading opportunities by reordering transactions within a block as it occurs. Flashbots claims to simplify the practice and mitigate its negative impacts by offering an off-chain block building marketplace in the form of MEV-Boost. The organization’s willingness to comply with OFAC sanctions was met with protests from the crypto community; in response, Flashbots open-coded their broadcast, allowing non-OFAC-compliant competitors to efficiently participate in the Ethereum MEV market.
However, in the two months after Ethereum transitioned from Proof-of-Work to Proof-of-Stake, the number of blocks built by so-called “OFAC-compliant” MEV-Boost relays skyrocketed from 9% to 79%, which provoked censorship. concerns from within the community.
However, after peaking on November 21, the number of blocks produced by censorship repeaters began to decline. While Flashbots generated over 46% of all MEV-Boost blocks today, the unobjectionable relays BloXRoute Max Profit and Ultra Sound Money took a good chunk of the MEV-Boost market share: 23.7 % and 16.9 %, respectively.
Disclaimer: At the time of writing, the author of this article owned BTC, ETH, and various other crypto assets.
