- Marinade Finance, Solana’s liquid staking protocol, is debating a governance proposal to combat malevolent validators and democratize MEV on Solana.
- Concerns regarding alleged MEV bots implicated in sandwich instances on Solana were also recently voiced by a researcher.
- By democratizing natural MEV and reducing toxic MEV, Marinade offered a “balanced” strategy.
One of the biggest Solana staking platforms, Marinade, is debating a new governance proposal to combat malevolent validators and resolve the network’s current maximum extractable value (MEV) problem.
MEV is the term used to describe the profits that may be made by rearranging the transaction order on a blockchain. This technique may optimize network performance, but if it is not monitored, it may also result in harmful practices like front-running and sandwich attacks.
According to the concept, MEV can present both opportunities and challenges since it can improve network efficiency by paying validators and maximizing liquidity. Unchecked MEV, on the other hand, can lead to detrimental user experiences including sandwich attacks, front-running, and centralized control, all of which threaten decentralization.
Marinade asserts that democratizing MEV would entail establishing procedures and frameworks that guarantee a more fair allocation of the advantages and opportunities that MEV offers. The objective will be to guarantee that a wider range of stakeholders can profit from the activities associated with transaction ordering and to avoid a concentration of power among a small number of participants.
MEV is present on blockchains such as Solana and Ethereum, but because of the fundamental architectural differences between the two, its appearance and effects vary.
The closure of the public mempool by MEV protocol Jito Labs this year, which resulted in the emergence of private mempools dominated by a small number of businesses, has caused additional difficulties, according to Marinade.
Sandwiching
Ben Coverston of Temporal, a research firm that focuses on Solana, expressed particular worries about so-called sandwich attacks on Solana that target MEV in an X post on Tuesday.
An attacker “sandwiches” a victim’s transaction by putting their own transactions both before and after it. This is known as a sandwich attack. This gives the attacker the ability to control the asset’s price and make money off of the victim.
The #1 sandwich bot, vpe (also known as arsc), siphons away millions of dollars in MEV EVERY DAILY. The worst part, though? This is about centralizing MEV, not simply about MEV. And it’s the biggest danger I’ve seen to Solana’s decentralization.
Within a year or two, the sandwich bot might overtake all other stakers in Solana, according to the Temporal researcher. I believe that within a year or two, Arsc will surpass all other stakers in Solana if the current trend of centralization continues. They’re not slowing down; they’re already in the top 200 by stake weight and are looping profits into staking their sandwiching validators.
Taking a balanced approach to MEV
Marinade proposed a “balanced” strategy that aims to reduce damaging MEV while spreading it as equally as feasible through an open market in order to address the issue of sandwiching and other MEV side effects.
At Marinade Labs, we understand that although MEV cannot be completely eradicated, its effects can be controlled and its worth may be equitably shared.
A public committee for delegation oversight and the identification and blacklisting of rogue validators was suggested by the staking platform.
In order to democratize access to MEV and, ideally, prevent the concentration of deal flows into a small number of private mempools, it also recommended reopening the public mempool. Temporal’s Coverston also proposed reopening the public mempool as a way to address sandwiching problems.
Finally, by directing MNDE DAO’s treasury monies to a specific research project, the plan promoted financing MEV research to improve transparency and data.
The idea will then be submitted to a vote and put into effect based on the community’s response, which Marinade will then solicit.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
