MEV-Boost centralizes block building. The post-Merge design outsourced block production to a competitive auction, creating a new critical dependency on permissioned relays to filter and forward blocks.
mev-the-hidden-tax-of-crypto
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The Cost of Speed: The Arms Race for MEV-Boost Relays and Centralization
An analysis of how the competitive rush for block-building speed in Ethereum's PBS model has concentrated power in a handful of MEV-Boost relays, creating systemic risks of censorship and failure.
introduction
THE TRAP
Introduction
The infrastructure built to mitigate MEV has become its most potent centralizing force.
Relays are a natural oligopoly. High operational costs for low-latency, secure data pipelines create significant economies of scale, favoring a few dominant players like Flashbots, BloXroute, and Agnostic.
This is a security vulnerability. The relay cartel controls the mempool view for most validators, creating a single point of censorship and failure that contradicts Ethereum's credibly neutral ethos.
Evidence: Over 90% of post-Merge blocks use MEV-Boost, with the top three relays consistently controlling more than 80% of the relayed block market share.
key-trends
THE COST OF SPEED
Executive Summary: The Relay Risk Trilemma
The race for sub-second block building has turned MEV-Boost relays into critical, centralized chokepoints, creating a new layer of systemic risk.
01
The Problem: Speed as a Centralizing Force
Relays compete on latency to win builder bids, creating a winner-take-most market. This favors centralized, well-funded operators with co-located infrastructure near validators, pushing out smaller players. The result is a fragile oligopoly where ~80% of blocks flow through a handful of dominant relays.
~500ms
Latency Arms Race
~80%
Top 3 Relay Share
02
The Solution: PBS-Enabled SUAVE
Flashbots' SUAVE aims to decentralize the relay function by making it permissionless and competitive. It separates the roles of block building and block distribution, allowing any entity to run a relay. This breaks the speed oligopoly by commoditizing the relay layer, similar to how Proposer-Builder Separation (PBS) commoditized block building.
Permissionless
Relay Access
Multi-Chain
Design Scope
03
The Risk: Censorship & Extractable Value
Centralized relays are single points of failure for censorship (OFAC compliance) and value extraction. They can reorder or censor transactions, and their opaque operations create trust assumptions for validators. This undermines Ethereum's credibly neutral base layer, creating regulatory and technical capture risks.
>50%
OFAC-Compliant Blocks
Opaque
Fee Logic
04
The Alternative: Encrypted Mempools & Threshold Cryptography
Long-term solutions like encrypted mempools (e.g., Shutter Network) and threshold cryptography remove the relay's ability to see transaction content pre-commitment. This neutralizes frontrunning and reduces the relay's role to a simple message passer, mitigating its power and centralization risk.
Pre-Execution
Encryption
N-of-N
Key Security
05
The Market Reality: Builder-Relay Vertical Integration
Major builders like Flashbots and bloXroute operate their own relays, creating vertical integration that centralizes the entire block production pipeline. This creates conflicts of interest and reduces network resilience, as a failure or attack on one entity can disrupt a significant portion of block production.
Top 2 Builders
Run Top Relays
Single Point
Of Failure
06
The Endgame: In-Protocol PBS & EigenLayer Restaking
Ethereum's in-protocol PBS (e.g., via EIP-7547) would eliminate the need for trusted relays entirely by moving the auction on-chain. In the interim, EigenLayer restaking could be used to cryptographically secure relay services, slashing them for misbehavior and creating a decentralized security layer.
On-Chain
Auction Finality
Cryptoeconomic
Security
market-context
THE COST OF SPEED
The State of Play: A Relay Oligopoly
The MEV-Boost relay market has consolidated into a centralized oligopoly, creating systemic risks for Ethereum's validator set.
Relay market consolidation is complete. The top three relays—BloXroute, Flashbots, and Agnostic—control over 95% of the MEV-Boost block market share. This creates a critical dependency for validators seeking maximum revenue.
The arms race for speed centralizes infrastructure. Relays compete on latency and uptime, forcing them to build proprietary, globally-distributed networks. This creates high capital and technical barriers that prevent new entrants and centralize block-building power.
Validators face a prisoner's dilemma. Choosing a smaller, decentralized relay like Titan or Ultra Sound means sacrificing significant MEV revenue. This economic pressure forces centralization, as seen in the dominance of Lido and Coinbase among top relay users.
Evidence: As of Q1 2024, the leading three relays consistently produce over 95% of MEV-Boost blocks. A single relay outage could instantly censor over 30% of Ethereum blocks.
THE COST OF SPEED
Relay Market Share & Performance Analysis
Comparative analysis of leading MEV-Boost relays, measuring market dominance, performance metrics, and centralization risks.
| Metric / Feature | Flashbots Relay | BloxRoute Max Profit | BloXroute Ethical | Ultra Sound Relay |
|---|---|---|---|---|
Market Share (Last 30 Days) | 28.1% | 21.7% | 15.3% | 18.9% |
Avg. Block Inclusion Latency | < 0.5 sec | < 0.3 sec | < 0.7 sec | < 0.6 sec |
Censorship Resistance | ||||
Supports MEV-Share / Orderflow Auctions | ||||
Avg. Builder Payment to Validator | 0.105 ETH | 0.113 ETH | 0.098 ETH | 0.102 ETH |
Geographic Centralization Risk | High (US/EU) | High (Global, single entity) | High (Global, single entity) | Medium (EU) |
Requires KYC/Whitelist | ||||
Open Source Relay Client |
deep-dive
THE INCENTIVE MISMATCH
The Centralization Flywheel: Speed Begets Power
The economic design of MEV-Boost creates a winner-take-all dynamic where relay performance directly dictates validator profits, accelerating centralization.
Relay performance is profit. The MEV-Boost auction's winner is the validator who receives the most valuable block from a relay. Faster, more reliable relays with superior block-building connections deliver higher returns, creating a direct financial incentive for validators to centralize around top-tier operators like BloXroute and Flashbots.
The flywheel is self-reinforcing. As validators flock to the fastest relays, those relays accumulate more block proposals. This increased flow of blocks provides more data and opportunities for their builders, further optimizing their strategies and widening the performance gap. Smaller, decentralized relays cannot compete, creating a natural monopoly on speed.
Evidence: Data from Rated.Network shows the top three MEV-Boost relays consistently command over 80% of the market share. This centralization point creates a systemic risk; a fault in a major relay like Manifold or Aestus can stall a significant portion of Ethereum block production.
risk-analysis
THE COST OF SPEED
The Systemic Risks of Relay Concentration
The MEV-Boost auction, designed to democratize block building, has instead created a new, critical centralization vector in the relay layer.
01
The Single Point of Failure
A dominant relay can become a systemic risk. Its failure or censorship could halt a significant portion of Ethereum's block production, creating a network-level outage. This is not hypothetical; a major relay outage in 2023 caused ~20% of blocks to be missed in a single slot.
- Censorship Risk: A relay can filter transactions, undermining neutrality.
- Liveness Risk: Technical failure cascades to validators and the chain.
~20%
Blocks Missed
>80%
Relay Market Share
02
The Economic Black Box
Relays operate as opaque intermediaries, obscuring the true flow of value. Validators are price-takers, often unaware of the optimal bid for their block space. This creates an information asymmetry where relay operators and builders capture disproportionate value.
- Opaque Fees: Hidden builder payments and priority gas auctions.
- Validator Sub-Optimization: Leaving ~10-20% of potential MEV revenue on the table.
10-20%
Revenue Leakage
Opaque
Fee Markets
03
The Protocol-Level Response: PBS
The endgame is Proposer-Builder Separation (PBS) enshrined in-protocol (ePBS). This moves the relay's critical functions—commitment, attestation, and slashing—into the core consensus layer, eliminating the trusted intermediary.
- Decentralized Censorship Resistance: Censorship becomes a protocol violation.
- Transparent Auctions: All bids are on-chain, creating a verifiable market.
- Long-Term Horizon: ePBS is a multi-year roadmap item post-Danksharding.
L1
Enshrined
Multi-Year
Roadmap
04
The Short-Term Mitigation: Relay Diversity
While ePBS is built, the ecosystem fights centralization by promoting relay diversity. Projects like Flashbots' SUAVE aim to decentralize the builder side, while validator tools encourage multi-relay configurations to dilute any single point of control.
- Client Diversity Parallel: Treat relay selection like client diversity.
- SUAVE's Vision: A decentralized block-building network and mempool.
- Validator Tools: Software to auto-optimize across multiple relays.
5+
Active Relays
SUAVE
Future Builder
counter-argument
THE PERMISSIONLESS FALLACY
The Rebuttal: "But Relays Are Permissionless!"
Permissionless entry is a necessary but insufficient condition for decentralization, as economic and technical barriers create a de facto oligopoly.
Permissionless is not decentralized. The MEV-Boost relay market is theoretically open, but the capital and operational requirements for running a competitive relay are prohibitive, creating a natural oligopoly.
Relays are not neutral infrastructure. They are strategic data gatekeepers that control the flow of block proposals and bids, creating a central point of failure and censorship risk for validators.
Economic incentives drive centralization. The race for zero-latency and exclusive order flow deals with builders like Flashbots, bloXroute, and Titan favors well-funded, centralized entities with global infrastructure.
Evidence: As of 2024, the top three relays (Flashbots, bloXroute, Agnostic) consistently process over 90% of MEV-Boost blocks, demonstrating extreme market concentration despite permissionless entry.
future-outlook
THE COST OF SPEED
Beyond the Relay: The Path to Decentralization
The MEV-Boost relay infrastructure, designed for efficiency, has created a centralized bottleneck that threatens Ethereum's core security model.
Relays are centralized choke points. MEV-Boost outsources block building to a competitive market but requires a trusted relay to validate and deliver payloads. This creates a single point of failure and censorship, contradicting Ethereum's permissionless ethos.
The arms race for speed centralizes power. Builders compete on latency to win blocks, favoring those with physical proximity to relays and validators. This creates a geographic centralization advantage for large, co-located operators like Flashbots and bloXroute.
Proof-of-custody is the critical fix. PBS proposals like EIP-7514 and EIP-7547 aim to decentralize relays by allowing validators to cryptographically verify block contents before signing. This removes the relay's trusted role.
Evidence: As of 2024, the top two MEV-Boost relays, operated by Flashbots and bloXroute, consistently control over 80% of relayed blocks, demonstrating extreme market concentration.
takeaways
THE COST OF SPEED
Key Takeaways for Validators and Architects
The MEV-Boost relay market is a high-stakes game where latency and trust trade-offs directly impact validator revenue and network health.
01
The Latency Trap: Why Fast Relays Win
Relays compete on sub-second block proposal times, creating a centralizing force. Validators chasing top-tier revenue are forced to connect to the fastest, most centralized relays, creating a positive feedback loop that marginalizes smaller, slower operators.
- Key Metric: Top relays operate at ~100-200ms proposal times.
- Centralization Risk: The top 3 relays consistently win >80% of blocks.
~200ms
Proposal Time
>80%
Top 3 Share
02
The Trust Dilemma: You Are the Fallback
MEV-Boost is an untrusted system. If a winning relay fails to deliver a valid block header, the validator must fall back to local block building within the 4-second slot time. This technical burden favors sophisticated, well-resourced operators.
- Architectural Imperative: Your node must have a robust local builder or a diversified relay set.
- Failure Consequence: Missing a proposal costs ~0.1-0.3 ETH in missed rewards and penalties.
4s
Slot Window
~0.2 ETH
Miss Cost
03
Solution: Diversify or Build
Mitigate relay risk through strategic diversification or in-house capability. This is a first-principles hedge against centralization and censorship.
- Diversify: Spread bids across >5 relays from different jurisdictions and client teams.
- Build: Implement local block building (e.g., Flashbots Suave, Eden) to guarantee proposal success and capture more value.
5+
Relay Minimum
100%
Uptime Guarantee
04
The Censorship Vector
Relays are the primary OFAC compliance choke point. Centralized relay dominance creates a single point of failure for network neutrality. Architects must plan for a post-MEV-Boost future with protocols like PBS (Proposer-Builder Separation) enshrined in the protocol.
- Current State: Major relays filter >90% of OFAC-sanctioned transactions.
- Future State: In-protocol PBS (e.g., EIP-4844 considerations) aims to decentralize this power.
>90%
Tx Filtered
1
Critical Chokepoint
05
The Builder Market is the Real Arena
Relays are just messengers. The real value extraction and competition happen at the builder layer (e.g., Flashbots, Titan, bloXroute). Validators must understand builder strategies—like time-bandit attacks or bundle merging—to select relays that attract ethical, high-performing builders.
- Revenue Driver: Builder sophistication dictates 95%+ of your MEV revenue.
- Strategy: Analyze relay leaderboards for builder diversity and dominance.
95%+
Revenue Factor
O(1)
Relay Role
06
The Endgame: Enshrined PBS
The current MEV-Boost model is a temporary crutch. The long-term solution is enshrined Proposer-Builder Separation (PBS) within the Ethereum protocol, which would decentralize block building and eliminate relay trust assumptions. Architects should design for this transition.
- Protocol Solution: Removes relay intermediaries and trust.
- Validator Impact: Shifts competitive edge to data availability and verification speed.
0
Relays Needed
L1
Trust Layer
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