Why the Bundler Relay Model Recreates Web2 Gatekeepers

Bundlers must connect to specialized relayers for block inclusion, creating a permissioned layer. This leads to fee cartels and MEV extraction, mirroring the validator/miner extractable value problem from L1s.

• Top 3 relayers process >80% of all ERC-4337 transactions.
• Relayers enforce strict whitelists, acting as de facto gatekeepers.
• Creates a fee market duopoly where user costs are dictated by relay pricing, not open competition.

The complexity of running a compliant bundler (staking, monitoring, RPC endpoints) pushes projects towards centralized providers like Alchemy and Stackup. This recreates the AWS dependency problem.

• ~95% of projects use a BaaS provider instead of self-hosting.
• Providers control transaction ordering and censorship resistance.
• Creates systemic risk: a BaaS outage halts entire application ecosystems.

Intent-based architectures (e.g., UniswapX, CowSwap) abstract complexity but delegate execution to centralized solvers. Users trade control for convenience, creating a new class of privileged intermediaries that capture value.

• Solvers compete for profit margins, not just best execution.
• Leads to solver cartels similar to relay cartels, as seen in CoW Protocol's solver ecosystem.
• The 'intent' abstraction layer becomes a new, centralized settlement bottleneck.

Today's dominant rollups rely on a single, permissioned sequencer for transaction ordering and execution. This creates a single point of failure and censorship, directly contradicting crypto's core value proposition.

• Single Point of Failure: One entity controls the mempool and block production.
• Censorship Risk: The sequencer can arbitrarily exclude transactions.
• MEV Capture: All value from transaction ordering is extracted by a central party.

Even with decentralized provers (like Espresso, Astria), the proposer/sequencer role remains a permissioned choke point. This splits decentralization, leaving the most valuable and impactful role centralized.

• Prover Decoupling: Validium/Volition models separate proof generation from data availability.
• Proposer Centralization: The right to order transactions and propose blocks is not permissionless.
• Economic Control: The proposer dictates fee markets and inclusion criteria.

Networks like Espresso, Astria, and Radius propose a decentralized layer for ordering transactions across multiple rollups. This creates a competitive marketplace for block space and returns MEV to users and dApps.

• Cross-Rollup Composability: Atomic transactions across different execution environments.
• MEV Redistribution: Auctions and governance can redirect extracted value.
• Credible Neutrality: No single entity controls the transaction timeline.

A radical alternative: bypass dedicated sequencers entirely. 'Based' or 'L1-sequenced' rollups (proposed by EigenLayer, inspired by Ethereum's PBS) use Ethereum validators for ordering, inheriting L1's security and decentralization.

• Ethereum Alignment: Leverages the existing validator set's economic security.
• No New Trust Assumptions: Sequencing trust is the same as L1 consensus trust.
• Native Composability: Seamless interaction with L1 and other based rollups.

Flashbots' SUAVE is a specialized decentralized mempool and block builder. It aims to become a pre-confirmation network that any chain can plug into, creating a competitive, transparent market for block space and MEV.

• Intent-Centric Flow: Users express outcomes, solvers compete to fulfill them.
• Cross-Chain Scope: Designed to serve Ethereum, rollups, and alternative L1s.
• Fee Market Reform: Replaces priority gas auctions with a sealed-bid auction model.

Centralized sequencers are a temporary, extractive phase. The economic pressure to capture cross-rollup MEV and the political pressure to resist censorship will force a shift to decentralized sequencing, just as mining pools decentralized Bitcoin.

• Fee Market Competition: Centralized sequencers have monopolistic pricing power.
• Regulatory Attack Surface: A single legal entity is an easy target for enforcement.
• Innovation Stagnation: A closed system cannot match the innovation rate of a permissionless network of builders.

Relays are the new sequencers. They control transaction ordering and access to block builders, creating a centralized MEV extraction point. This is the Flashbots relayer problem reborn for account abstraction.

• Single Point of Censorship: A dominant relay can exclude transactions.
• Vertical Integration: Major players like Alchemy and Stackup bundle RPC, bundler, and relay services.
• Opaque Auctions: Profit from order flow arbitrage without user consent.

The antidote is to separate the bundling function from the relay function using decentralized networks. Think The Graph for data, but for transaction propagation.

• Intent-Based Routing: Protocols like UniswapX and CowSwap demonstrate trustless matching.
• Staked Relays: Use a cryptoeconomic security model, similar to EigenLayer for AVSs.
• Standardized APIs: Prevent vendor lock-in with open specs, moving beyond proprietary Stackup or Alchemy bundles.

Relying on a bundled API from Alchemy or QuickNode is fast but suicidal. You cede control over user experience, cost, and compliance.

• Vendor Lock-In: Your UX depends on their uptime and pricing.
• Unpredictable Costs: Relay fees are a black box, unlike predictable L1 gas.
• Strategic Imperative: Own the bundler client. Use open-source stacks from Ethereum Foundation or Stackup, but run it yourself.

Investing in a 'bundler-as-a-service' startup is betting on a temporary inefficiency. The real value accrues to base-layer protocols and intent-solving networks.

• Fragile Moats: Relay services are commodities; their margins will compress to zero.
• Protocol Native Bets: Back the LayerZero or Across model for cross-chain intents, not the relay operator.
• Vertical Integration Plays: The winner will bundle RPC, bundler, wallet, and paymaster—like Coinbase's smart wallet stack.