Ethereum Reverses Post-Merge Censorship Trend

MEV censorship has been roughly sitting at 70% over the past month


Source: DALL·E


Concerns around possible censorship of Ethereum transactions was prevalent in the weeks leading up to and after the Merge, but the latest data shows that this upward trend may be reversing.

The Merge introduced changes to the process of block building alongside the transition from proof-of-work to proof-of-stake, that introduced some risk of centralization, particular with respect to MEV — or maximum extractable value.

Tracking site MEV Watch reveals that the percentage of censored blocks has dropped from its all-time high of 79% to roughly 70% over the past month. Anything less than about 99%, means Ethereum remains censorship free.

MEV refers to the maximum amount of income that can be earned by validators from the automated process of re-ordering transactions for inclusion in a block.

If MEV in a block exceeds standard block rewards, validators may choose to re-organize a block to capture the income generated by MEV for themselves. 

In order to prevent malicious MEV practices, validators choose to use MEV-Boost relays which allow them to request blocks from a network of builders.

But after the US Treasury’s Office of Foreign Assets Control (OFAC) sanctioned crypto privacy service Tornado Cash, popular MEV-Boost realy provider Flashbots — which is based in the US — decided to remain OFAC-compliant, meaning it would ignore any transactions which were restricted by OFAC.

That alone is not enough to censor Ethereum, although it can delay some transactions, Uri Klarman, CEO of relay provider bloXroute Labs previously told Blockworks.

“If I had an OFAC-restricted transaction, it [would] take more time for my transaction to be included, but eventually a validator, which isn’t ignoring [OFAC transactions] would include it,” Klarman said. 

Nevertheless, the concern within the Ethereum community is that if the proportion of censored blocks were to become too high, it could threaten a fundamental ethos of Ethereum — credible neutrality — as well as a desirable feature of most public blockchain networks: censorship resistance.

Coming up with technical solutions to preserve these values is a major goal of the Ethereum community.

Developing SUAVE

Ethereum developers have also launched a new project to combat censorship.

Dubbed SUAVE, short for “Single Unifying Auctions for Value Expression,” the project aims to decentralize block building itself.

SUAVE was first teased at Devcon, the Ethereum foundation’s annual conference, where Philip Daian, a Flashbots steward, said its latest technology would “make TradFi look embarrassing.” The project’s latest vision was unveiled in a blog post on Nov. 22. 

At a high level, SUAVE will be a new blockchain that acts as a plug-and-play mempool and decentralized block builder for other blockchains. 

“SUAVE goes beyond sequencing for a single blockchain. We designed SUAVE to be the mempool and block builder for all blockchains,” Hasu, pseudonymous strategy lead at Flashbots tweeted.  

Through building a decentralized sequencing layer, the Flashbots team wants to “give domains control over their own validation guarantees and ensure smaller domains stay decentralized.”

Domains means any combination of layer-1 or layer-2 blockchains, but also side-chains, shards, and even centralized exchanges.

Flashbots does not intend to participate in the marketplace beyond bootstrapping, the company noted. 

“We consider this strategy the most aligned with our mission and the health of the entire ecosystem,” the company said.

Don’t miss the next big story – join our free daily newsletter.


Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

MON - WED, MARCH 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience:  Attend expert-led panel discussions and fireside chats  Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts   Grow your network […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Frax report cover.jpg


Frax saw continued development in its frxETH liquid staking derivative and Fraxlend money market throughout 2023. Frax V3 introduces an RWA strategy to drive utility to the protocol's cornerstone product, the FRAX stablecoin.


MicroStrategy discloses the purchase of 16,000 bitcoin throughout November


Digital asset firms face potential new regulatory landscape under Treasury’s proposed authority expansion


Uniswap Labs will be providing trading APIs to Talos investors through Fireblocks


DYDX supply will climb by up to 80% after the Friday unlock, but a couple factors make a massive sell-off appear unlikely


Switzerland-based Pando Asset, which has crypto products trading on the SIX Swiss Exchange, now looks to the US


Binance does not hold the required licenses to advertise and serve customers in the Philippines, the country’s securities regulator said