The Future of L2s is Tied to Bundler Economics

Today, a single sequencer (e.g., Optimism, Arbitrum) acts as the sole bundler, creating a central point of failure and rent extraction. This contradicts the decentralized ethos and creates systemic risk.

• Single Point of Censorship: A malicious or compromised sequencer can freeze user funds.
• MEV Capture: All transaction ordering value is captured by the L2 team, not returned to users or builders.
• Fee Inefficiency: No competitive market to drive down costs for end-users.

The endgame is a competitive marketplace where anyone can run a bundler, similar to Ethereum's validator set. Projects like EigenLayer, Espresso Systems, and Astria are building this infrastructure.

• Shared Security: Leverage Ethereum's validator set or restaking pools for cryptoeconomic security.
• Proposer-Builder Separation (PBS): Separate the role of building blocks (bundlers) from proposing them, mitigating MEV centralization.
• Fee Market Dynamics: Competition between bundlers drives costs toward marginal cost, benefiting users.

User intents (declarative transactions) shift complexity from users to a new class of solvers, making efficient bundling a competitive advantage. This is the model of UniswapX, CowSwap, and Across.

• Solver Competition: Solvers compete to fulfill user intents at the best price, abstracting gas and cross-chain complexity.
• Batch Optimization: Solvers naturally aggregate intents into optimally priced bundles for execution.
• Native Cross-Chain: Intents are chain-agnostic, forcing bundlers to operate across Ethereum, Arbitrum, Optimism, and Base.

Centralized bundlers become single points of failure for transaction ordering, enabling front-running and censorship. This creates a toxic economic loop where higher profits from MEV extraction further incentivize centralization, undermining the L2's core value proposition.

• Key Risk: Single sequencer can blacklist addresses or censor transactions.
• Key Metric: >90% of L2 blocks are often produced by a single entity.
• Result: L2 security reverts to the trust model of the centralized bundler.

In current models like Optimism and Arbitrum, sequencer/bundler profits (MEV, priority fees) are captured by the centralized operator, not the protocol treasury. This misalignment starves the L2 of a sustainable protocol-owned revenue stream needed for long-term security and development.

• Key Problem: Value accrues to operators, not token holders or the protocol.
• Contrast: Ethereum burns base fee; Solana burns 50% of priority fees.
• Result: L2 tokens become governance-only, with weak economic security.

Proposed solutions like a shared sequencer set (e.g., Espresso, Astria) merely distribute trust among a fixed, permissioned cartel. This replaces a single point of failure with an oligopoly, failing to achieve credible neutrality or permissionless participation. The economic incentives for collusion remain high.

• Key Limitation: Set is fixed, permissioned, and small (<100 entities).
• Vulnerability: Cartel can still extract maximal MEV and set arbitrary fees.
• Result: Recreates the Proof-of-Authority problem with extra steps.

L2s that use validiums or volitions (e.g., StarkEx, zkPorter) introduce a Data Availability Committee (DAC). This adds another centralized trust layer beyond the bundler. Users must trust both the sequencer and the DAC not to withhold data, creating a dual-point-of-failure that is often overlooked.

• Key Problem: Security is only as strong as the weakest DAC member.
• Reality: DACs are typically 5-10 known entities.
• Result: Full Ethereum rollup security is traded for scalability, concentrating trust.

The only viable endgame is enshrined PBS at the L2 level, mirroring Ethereum's roadmap. This separates the role of block building (competitive, permissionless market) from block proposing (decentralized, stake-secured validators). EigenLayer restaking can bootstrap this cryptoeconomic security.

• Key Mechanism: Permissionless builders bid for block space; validators choose the highest bid.
• Benefit: Unlocks permissionless innovation in block building while securing ordering.
• Result: MEV revenue is democratized and can be directed to protocol treasury.

A simple, immediate fix: mandate a permissionless transaction queue with force inclusion guarantees, as seen in Arbitrum's delayed inbox. This allows any user to bypass a censoring sequencer by submitting a transaction directly to L1, forcing it into the L2 chain after a delay. It's a circuit-breaker for censorship.

• Key Feature: Trustless censorship-resistance with a known time delay (e.g., 24h).
• Trade-off: Introduces latency for censored users.
• Result: Creates a credible threat that disincentivizes sequencer censorship.

Today's dominant L2s like Arbitrum and Optimism run permissioned sequencers, capturing ~90% of MEV and fee revenue. This is a massive value drain from the ecosystem back to the foundation.\n- Creates extractive economics for dApps and users.\n- Introduces a single point of censorship/failure.\n- Undermines credible neutrality, the core crypto value proposition.

Decouple block building from proposing. Let a competitive market of permissionless bundlers/sequencers bid for the right to order transactions.\n- Drives fee revenue to builders & stakers, not a single entity.\n- Enables shared sequencing layers across rollups (e.g., Espresso, Astria).\n- Unlocks cross-rollup atomic composability as a native feature.

Adapt Ethereum's PBS design. The L2's Proposer (often the L1 bridge contract) selects the highest-value block from a competitive auction run by Builders (bundlers).\n- Censorship resistance via forced inclusion lists.\n- MEV is democratized and redistributed to protocol stakers.\n- Critical for enabling based sequencing and EigenLayer restaking of sequencing rights.

The stack modularizes. Rollup frameworks (OP Stack, Arbitrum Orbit, zkStack) become cheap commodities. The real moat and business model shifts to the bundling/sequencing layer.\n- Winners will operate at the sequencing layer (e.g., Espresso, Astria, Radius).\n- L2s compete on execution & settlement, not sequencing.\n- Ultimate alignment: Value accrues to the decentralized network of block builders, not a corporate entity.