- In order to alleviate the apparent centralization in the Ethereum block-building process, Flashbots launched BuilderNet with the goal of more equitably allocating power over this process among many operators.
Flashbots, a blockchain research and infrastructure company, has unveiled BuilderNet, which it says will solve the apparent centralization problems with the block-building process on the Ethereum network.
With a few operators presently creating more than 90% of Ethereum’s blocks, block builders—those who aggregate transaction bundles into blocks and submit them to validators for maximum extractable value—are having centralization problems, according to Flashbots.
The company clarified that there are issues with centralization because a few number of block builders now control the Ethereum process, assembling transaction bundles and submitting them for MEV.
The maximum possible value that may be retrieved from a blockchain transaction, including front-running and arbitrage, is known as MEV. Typically, Ethereum block builders take the earnings from MEV, figuring out the transaction sequence and sending it to Ethereum validators.
In order to solve this, Flashbots proposes a cooperative block-building method that allegedly encourages cooperation among several operators in order to safely share and process order flow. Flashbots, block builder Beaverbuild, and Ethereum client supplier Nethermind are the first partners of the venture, called BuilderNet.
A decentralized route ahead is BuilderNet. It seeks to improve Ethereum’s resistance to censorship, nullify exclusive MEV order flow transactions, and hasten decentralization across rollups and applications.
An important step toward completely decentralizing Ethereum’s block-building process and enhancing the decentralization of Ethereum-based rollups and apps is BuilderNet’s multi-operator system, which enables many parties to oversee the same block builder.
To improve security and speed, this system will make use of trusted execution environments. Flashbots claims that by offering encrypted order flows and improved anonymity, this setup will provide a fair environment for MEV searchers and solvers, eventually resulting in a more equitable distribution of MEV over time.
According to Flashbots, BuilderNet’s initial rollout will work with the current centralized builders from its founding partners to enable a gradual transition to a more decentralized architecture.
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