Why Shared Sequencing Demands New Cryptoeconomic Models

In a shared sequencer network, MEV is extracted at the ordering layer before execution. The classic validator/staker model fails to align incentives for fair distribution.

• Key Insight: MEV revenue must be shared with the rollups using the service to prevent sequencer capture.
• Solution Blueprint: Fee-switching models like those pioneered by Flashbots SUAVE or Astria, where a portion of ordering profits are redistributed to rollup treasuries or burned.

Permissionless sequencing requires a cryptoeconomic bond to ensure liveness and honest ordering. Simple proof-of-stake is insufficient for multi-rollup commitments.

• Key Insight: Stake must be slashable for provable malfeasance (e.g., censorship, incorrect ordering).
• Solution Blueprint: EigenLayer-style restaking, where operators delegate security from Ethereum to the shared sequencer, creating a ~$50B+ pooled security budget. Projects like Espresso Systems are building this.

Users and dApps need atomic transactions across multiple rollups. A shared sequencer is the only entity that can guarantee cross-domain atomicity without slow, trust-minimized bridges.

• Key Insight: The economic model must incentivize sequencers to include and order cross-rollup bundles correctly.
• Solution Blueprint: Priority fees for atomic bundles, creating a market similar to UniswapX's fillers but for ordering. This enables native Layer 2 interoperability.

A concrete implementation using a decentralized sequencer set with fast finality. Its model ties economic security directly to EigenLayer restakers.

• Key Benefit: Rollups retain sovereignty over execution while outsourcing costly consensus.
• Key Benefit: Sub-second finality enables high-frequency trading and real-time apps across the rollup ecosystem.

To prevent centralization and capture, the right to produce the next block (or batch of blocks) should be auctioned, not simply assigned by stake weight.

• Key Insight: This separates voting power (security) from block production (liveness), a lesson from Ethereum's PBS.
• Solution Blueprint: A recurring auction, like Astria's proposed model, where rollups or users pay for ordering priority, creating a more efficient and censorship-resistant market.

Shared sequencers must post data to a DA layer (e.g., Celestia, EigenDA, Ethereum). This is a massive, fixed cost that doesn't scale with the number of supported rollups.

• Key Insight: Economics must efficiently bundle DA costs across all users, similar to how Avail or Celestia optimize for rollup throughput.
• Solution Blueprint: A blob-space futures market where sequencers hedge DA costs, and rollups pay a predictable subscription fee based on projected data usage.

Decentralized sequencing creates a fundamental trade-off between censorship resistance, finality speed, and chain liveness. A naive token staking model fails to align incentives across all three vectors.

• Security: High stake doesn't prevent a cartel from censoring or delaying transactions.
• Liveness: Slashing for downtime can paradoxically reduce network resilience during outages.
• Finality: Fast finality requires honest majority assumptions that are economically fragile.

Protocols like EigenLayer and Espresso propose redistributing sequencer MEV to stakers. This creates a perverse incentive for validators to maximize extractable value at the expense of user experience and chain integrity.

• Adversarial Alignment: Stakers profit from network congestion and predatory arbitrage.
• Centralization Pressure: MEV cartels form, replicating Ethereum's PBS problems at the sequencer layer.
• Solution: Fee burn mechanisms or direct user rebates (see CowSwap) break this feedback loop.

Sequencers bundling DA (e.g., Celestia, EigenDA) creates a cross-subsidy trap. The DA subsidy masks the true cost of sequencing, leading to unsustainable economics and vendor lock-in.

• False Economy: Apps choose a sequencer for cheap DA, not quality of service.
• Systemic Risk: A failure in the DA layer cascades to all dependent rollups.
• Solution: Explicit pricing and decoupled DA/sequencing, as seen in Avail and Near DA.

Shared sequencers like Astria or Radius promise atomic cross-rollup composability. This requires a universal pre-confirmation standard, creating a new attack surface for latency arbitrage and griefing.

• New Vector: Adversaries can spam cross-chain intent auctions to delay settlements.
• Fragmentation: Without a dominant standard (cf. LayerZero, Axelar), liquidity fractures.
• Solution: Cryptoeconomic penalties for reneging on pre-confirmations and proof-of-stake slashing for availability.

Liquid staking tokens (LSTs) for sequencer security, as proposed by EigenLayer restaking, create reflexive leverage. A price drop in the LST triggers mass unbonding and sequencer instability.

• Reflexivity: LST de-peg -> slashings -> more selling -> further de-peg.
• Correlated Slashing: A failure in one app using the shared sequencer can slash stake backing all apps.
• Solution: Non-transferable stake or over-collateralization requirements exceeding 200%.

Geographically centralized sequencer sets are vulnerable to jurisdictional attack. A state actor can compel censorship of specific addresses, violating credible neutrality.

• Single Point of Failure: >50% of nodes in one legal jurisdiction creates compliance risk.
• Protocol Liability: The sequencer protocol may be deemed a money transmitter.
• Solution: Zero-knowledge proofs of fair ordering (e.g., Fairblock) and jurisdictional diversity quotas.