Originally written by Peng SUN, Foresight News

MEV (Maximum Extractable Value) refers to the economic benefits that MEV searchers and block builders can extract after sorting unpackaged transactions. For quite some time, MEV has gained notoriety as an umbrella term for on-chain arbitrage transactions, and MEV searchers tend to work with validators to find potential arbitrage opportunities. Among the many types of MEV attacks, the worst are frontrunning transactions and sandwich attacks, which cause huge damage and negative externalities to users and the Ethereum network.

MEV is an inherent component of the blockchain network, and its revenue has been flowing into MEV searchers, block builders, block proposers and the Ethereum network, but as the direct source and biggest victim of MEV, Ethereum users, wallets and Order flow initiators such as DApps cannot participate in MEV revenue sharing. In view of this, Flashbots, an Ethereum infrastructure service, is also exploring a MEV revenue sharing solution, and launched a beta version of the MEV-Share protocol yesterday, aiming to distribute a portion of MEV revenue to Ethereum users.

What is MEV-Share?

MEV-Share is an open source protocol that uses privacy and commitment to facilitate permissionless cooperation between users/order flow providers and MEV searchers. The aggregation of order flow in MEV-Share can not only weaken the centralization of proprietary order flow in the Ethereum network, but also allow other order flow sources such as users, wallets and DApps to participate in MEV revenue sharing.

How MEV-Share works

The MEV-Share protocol introduces "Matchmaker", which can match user transactions with MEV searcher transaction bundles (bundles), enabling searchers to further optimize their MEV capture efforts.

Flashbots run Matchmaker on the Ethereum mainnet, Matchmaker has endpoints to receive transactions and bundles, and an SSE Event Stream endpoint to send pending events/transactions to Seekers. Specifically, after users submit their transactions to Matchmaker, Matchmaker will selectively share the transaction information with searchers, and searchers will listen to and receive new event streams through the SSE endpoint. The Seeker then proposes a transaction for Matchmaker, which bundles it with the user's transaction. Currently, Flashbots only supports backruns, which will package user transactions with each valid Seeker backrun and forward them to block builders. The block builder will select the winning package and return a portion of the Seeker's backrun profits to the user.

If no valid trailing transaction is submitted, the transaction will be treated as a normal protected transaction and get all the benefits of Flashbots Protect, including frontrunning protection, no failed transactions, etc.

How to use MEV-Share

The MEV-Share protocol is included in Flashbots Protect. Flashbots Protect is an RPC tool that can be integrated with user wallets to fend off bots trying to profit by front-running user transactions. In the Flashbots documentation, users can directly click "Connect Wallet to Protect" to connect to Protect RPC through MetaMask.

Transactions from Flashbots Protect users automatically flow to Flashbots Matchmaker, which returns 90% of the MEV earnings generated by their transactions to the user, no action required from the user. By default, users connecting to Protect will launch Matchmaker with a Stable configuration that is continuously tuned by Flashbots to optimize trade execution while protecting users from harmful MEV attacks.

In addition, wallet and DApp developers can also use the language of the MEV-Share Matchmaker client library to code, send transactions directly to Flashbots Matchmaker or send private transactions to Matchmaker API.

Functions and Features of MEV-Share

The biggest feature of MEV Share is that it allows users to adjust privacy settings and manage order flow sharing, thereby preventing front-running transactions, and selectively sharing transaction information with MEV searchers, which can not only obtain "MEV redistribution rewards", but also ensure basic privacy.

Flashbots Protect RPC does not track any kind of user information (IP, location, etc.), nor does it store or log any user information. MEV-Share users on Flashbots Protect can use custom privacy configurations, where parameters include hints (Hints) and target builders (Target Builders). By specifying the prompt multiple times, it is possible to specify exactly which data fields in a user's transaction are shared with searchers on MEV-Share. Sharing less data will enhance privacy, while contributing more data will improve the chances of transactions being executed quickly and earning MEV revenue. Currently, the information that can be shared includes calldata, logs, function_selector, contract address, transaction hash, etc.

By default, Matchmaker does not share transaction information with Seekers beyond the transaction hash. If users need complete privacy, they can add a "hash" hint in the Protect RPC URL, that is, "https://rpc.flashbots.net?hint=hash". This move will completely hide all data identifying the transaction sent to the Seeker's Matchmaker, the transaction hash cannot be used to obtain any information about the transaction or other sources.

If users need the fastest execution speed and the most MEV revenue, they can share calldata, logs, function_selector and contract addresses under low privacy conditions, that is, "https://rpc.flashbots.net?hint=calldata&hint=logs&hint= function_selector&hint=contract_address&hint=hash". For more requirements and configuration details, please refer to:

At the same time, users can also specify the target builders and specify which block builders to send transactions to. Currently, MEV-Share supports two target builders, "Default builders" and "Flashbots". It's worth noting that adding other builders can make user transactions on-chain faster and more reliably, but Flashbots does not control how other builders operate and makes no guarantees about their behavior.

Overall, Flashbots follows the lead of Eric Huges in "Cypherpunk ManifestoThe statement in "Privacy (privacy) is not secret (secrecy). Privacy is something that one does not want the whole world to know, but secret (secret) is something that one does not want anyone to know. The world shows its power.” Flashbots allows users to customize requests and share other information with searchers while ensuring the most basic privacy conditions.

In addition, for users who are inclined to the application layer, it is necessary to find the correct prompt, put forward the most suitable instruction, and achieve a certain balance between privacy and efficiency.

Future Development and Considerations

Flashbots Matchmaker is an implementation of the MEV-share protocol, and the team is designing a standard interface for the entire protocol. Also, the Flashbots team is still exploring new improvements. For example, providing users with customizable MEV revenue rebate ratios, allowing designation of recipients of MEV revenue, more privacy settings with per-protocol defaults, and better enforcement preferences, allowing searchers to submit more simple trailing The transaction package for the transaction.

It is important to note that Flashbots Matchmaker is in beta and the Matchmaker service may experience service interruptions and API interruptions during the trial phase.