Why Shared Sequencers Centralize Economic Control

A single sequencer entity controls the mempool, enabling maximal value extraction from all connected rollups. This centralizes the ~$1B annual MEV market and creates a single point of failure for censorship resistance.\n- Vertical Integration: The sequencer can front-run, back-run, and sandwich trades across all connected chains.\n- Fee Market Capture: Transaction priority becomes a centralized auction, not a decentralized market.

Sequencer fees become a mandatory toll on every transaction, extracting value that would otherwise accrue to L1 validators or rollup validiums. This creates a revenue monopoly over the transaction supply chain.\n- Economic Drain: Fees are diverted from the base layer's security budget (e.g., Ethereum).\n- Opaque Pricing: Users have no alternative routing, leading to potential rent-seeking behavior.

Cross-rollup atomic composability depends entirely on the shared sequencer. This grants it veto power over inter-chain DeFi, making protocols like Uniswap, Aave, and Compound reliant on a centralized coordinator.\n- Single Point of Failure: A sequencer outage halts cross-chain liquidity and arbitrage.\n- Protocol Capture: The sequencer can prioritize its own affiliated applications, distorting the ecosystem.

Current implementations like Espresso Systems and Astria demonstrate the centralization vector. Their permissioned validator sets and proposed governance models concentrate power, despite using DVT.\n- Permissioned Sets: Initial operator sets are small, known entities (e.g., Figment, Everstake).\n- Governance Risk: Upgrade keys and profit-sharing mechanisms are held by founding teams or DAOs, not a credibly neutral protocol.

A single shared sequencer becomes the mandatory gateway for all cross-rollup transactions, creating a centralized MEV extraction point. This negates the competitive auction dynamics of decentralized proposer-builder-separator (PBS) models.

• Captures 100% of cross-domain arbitrage between connected rollups.
• Enables censorship by controlling transaction ordering across multiple chains.
• Creates a single point of regulatory attack for the entire ecosystem it serves.

Isolated rollup fee markets force sequencers to compete on price and latency. A shared sequencer monopolizes fee pricing for a bundle of chains, leading to rent extraction and reduced innovation in block space markets.

• Eliminates fee competition between sequencers for the same user.
• Introduces supra-competitive fees for cross-rollup composability.
• Stifles experimentation with novel fee models (e.g., time-based, subscription).

Decentralized shared sequencer networks (e.g., Espresso, Astria) propose a validator set to mitigate single-operator risk. However, economic control remains centralized at the protocol layer, not the operator layer.

• Validator set still controls the ordering rule and fee split for all connected chains.
• Governance token becomes the ultimate economic lever, replicating L1 political risks.
• Incentive misalignment if the sequencer's token value is prioritized over constituent rollup health.

Rollup builders must architect for optionality. Contracts should be agnostic to sequencer source, enabling a competitive marketplace for ordering services and preserving the rollup's ultimate control over its economic policy.

• Implement force-inclusion channels to bypass a malicious/censoring sequencer.
• Design for multi-sequencer future using standards like shared pre-confirmations.
• Retain the right to fork the sequencer set without a hard fork of the rollup itself.

Value capture moves from L1 validators and individual rollup sequencers to the shared sequencing layer. This creates a new, concentrated investment thesis but also a systemic fragility. Evaluate based on defensibility and decentralization roadmap.

• Assess the fee-sharing model with constituent rollups—is it extractive or aligned?
• Scrutinize the decentralization timeline; a centralized service is not a protocol.
• Model the risk of rollup exit; the network effect must be stronger than the economic lock-in.

The ultimate decentralization of economic control may bypass sequencers entirely. Intents-based architectures (UniswapX, CowSwap) and shared auction markets like SUAVE shift power to solvers and users, making the sequencer a commodity execution layer.

• Shared sequencers today are a stepping stone, not the final architecture.
• Long-term, value accrues to solver networks and intent infrastructure.
• Builders should hedge by integrating intent standards early.