Why MEV-Boost Exposes the Centralizing Tendencies of Ethereum

The Proposer-Builder Separation (PBS) is Ethereum's core scaling concession. It outsources complex block construction to specialized builders, turning validators into passive block proposers. This creates a centralized builder market where a few entities like Flashbots, bloXroute, and Manifold control transaction ordering.

Validators voluntarily censor for profit. They connect to MEV-Boost relays, which only serve blocks from trusted builders, filtering for OFAC compliance. This surrenders Ethereum's credible neutrality to a handful of corporate entities, contradicting the network's foundational ethos.

The builder oligopoly is measurable. Post-Merge, over 90% of blocks are built via MEV-Boost. The top three builders consistently produce over 50% of blocks, creating systemic risk and rent extraction that protocols like CowSwap and UniswapX now try to circumvent with intents.

Incentive alignment is everything. The protocol's security model assumes validators act rationally for profit, not altruistically for ideology. MEV-Boost, by externalizing block building, creates a market where validators are paid to outsource their core duty.

MEV-Boost centralizes block production. The system funnels order flow to a handful of specialized builders like Flashbots and bloXroute. Validators choose the highest-paying header, not the most decentralized one, creating a winner-take-most market for block space.

The relay is the new choke point. Builders submit blocks to trusted relays, which are centralized, permissioned validators. This creates a critical trust layer where entities like Ultra Sound and Agnostic Relay control censorship resistance and liveness.

Evidence: Over 90% of post-Merge blocks are built via MEV-Boost. The top three builders consistently produce over 50% of blocks, demonstrating the system's inherent centralizing pressure, which protocol-level PBS aims to solve.

Optionality created a market. MEV-Boost launched as an optional middleware, allowing validators to outsource block building to specialized searchers. This created a competitive, permissionless market for block space, initially praised for democratizing access to MEV revenue.

Network effects enforce adoption. Validators who skip MEV-Boost forfeit substantial revenue, creating immense economic pressure to adopt it. This transforms an optional tool into a critical infrastructure dependency for any competitive validator.

Power concentrates at the builder layer. The builder market exhibits winner-take-most dynamics. A few professional entities like Flashbots, bloXroute, and Builder0x69 consistently win the majority of blocks due to superior data and algorithms.

Evidence: Over 90% of Ethereum blocks are now built via MEV-Boost. The top three builders frequently control more than 50% of the market, creating a centralization bottleneck more concentrated than the validator set itself.

Enshrined PBS formalizes separation but does not decentralize the builder market. The protocol enforces a builder-proposer split, yet the specialized hardware and capital required for optimal block building will still concentrate among a few entities like Flashbots and bloXroute.

The builder market centralizes naturally due to economies of scale. Just as mining pools dominated PoW, the most profitable builders will attract the most stake, creating a feedback loop of centralization that protocol rules cannot break.

Data availability is the real bottleneck. Even with enshrined PBS, builders must source transactions from a public mempool or private channels, replicating the information asymmetry that MEV-Boost's relays manage today.

Evidence: The top three MEV-Boost relays control over 90% of post-merge blocks. Enshrined PBS changes the protocol's rules but not the economic incentives that drive this consolidation.

The centralization is structural. MEV-Boost outsources block building to a competitive market, but the relay layer that enforces censorship resistance is a natural monopoly. This creates a single point of failure for the network's liveness guarantees, as seen when a major relay like Flashbots went offline.

Unwinding requires a fork. Removing MEV-Boost without a replacement destroys validator revenue, forcing a contentious protocol change. The PBS roadmap (Proposer-Builder Separation) is the official solution, but its multi-year timeline leaves the network exposed to relay cartelization and regulatory capture in the interim.

Validators are trapped by yield. The opportunity cost of running vanilla consensus is now 20-30% of potential earnings. This economic pressure makes decentralization a luxury most staking pools, from Lido to Coinbase, cannot afford, cementing the relay oligopoly of Flashbots, BloXroute, and Manifold.

Evidence: Over 90% of post-Merge blocks are built via MEV-Boost. The top three relays consistently control >80% of the market, demonstrating the winner-take-most dynamics that define this critical infrastructure layer.