Why MEV Extraction Shifts from Miners to Bundlers

The MEV supply chain is now a competitive marketplace. Searchers run algorithms to find profitable opportunities, while specialized actors like Flashbots builders construct optimized blocks. Validators in PoS or sequencers in rollups simply accept the most profitable bundle, auctioned via protocols like MEV-Boost or SUAVE.

Miners were passive extractors; they captured value from the public mempool. Bundlers are active optimizers, competing on execution quality in private channels. This shift creates a professionalized MEV industry, separating block production from transaction ordering.

The evidence is in the revenue. Post-Merge, over 90% of Ethereum blocks are built via MEV-Boost. On Arbitrum and Optimism, centralized sequencers currently capture all MEV, a dynamic that protocols like Espresso and Astria aim to decentralize.

Bundlers control execution order. In an account abstraction (ERC-4337) world, user operations are submitted to a public mempool. The bundler is the entity that packages these operations into a single on-chain transaction, deciding the final sequence. This grants them the same ordering power that Proof-of-Work miners historically held.

MEV extraction is now a service. Miners captured value via priority gas auctions and dark pools. Bundlers, like those operated by Pimlico or Stackup, monetize by offering MEV-optimized bundling as a subsidized service, abstracting complexity from users. The revenue model shifts from seigniorage to a fee-for-service marketplace.

Decentralization is the new frontier. Miner decentralization was solved by Nakamoto Consensus. Bundler decentralization is the unsolved problem, with current implementations like Ethereum's p2p mempool and SUAVE aiming to prevent a single entity from monopolizing the right to order transactions. The censorship resistance battle has moved up the stack.

The MEV supply chain is reorganizing. Proof-of-Stake and specialized block builders like Flashbots Auction have centralized block production, but the real value capture moved upstream to the transaction ordering layer.

Bundlers are the new miners. Private mempools and order-flow auctions, pioneered by entities like Flashbots and CoW Swap, allow searchers to pay bundlers for priority. This creates a fee market for ordering separate from the base gas fee.

Wallets control the spigot. The wallet signature is the atomic unit of user intent. Whoever aggregates and routes this intent—be it a smart wallet like Safe, a service like UniswapX, or a standard like ERC-4337—controls the most valuable transaction flow.

Evidence: Over 90% of Ethereum blocks are now built via MEV-Boost, and intent-based aggregators like Across Protocol and UniswapX now route billions in volume, proving the economic logic of intent abstraction.

Bundlers control transaction ordering within a UserOperation batch before submission to a public mempool. This creates a direct analog to block-building MEV on L1, but for the ERC-4337 ecosystem.

The MEV surface is protocol-specific. Bundlers on Arbitrum or Optimism arbitrage sequencer inclusion latency, while Polygon or Scroll bundlers compete in a public mempool akin to Ethereum.

Private orderflow is the ultimate prize. Bundlers integrated with wallets like Safe{Wallet} or Coinbase Smart Wallet capture exclusive, pre-public transaction flow, mirroring Flashbots' role on Ethereum.

Evidence: On testnets, over 60% of UserOperations are bundled by just three entities, demonstrating rapid centralization of this new extractive role.

PBS formalizes the role of the builder, creating a professionalized market for MEV extraction. This moves the economic activity from the proposer (the validator) to a new entity whose sole purpose is maximizing transaction value. The builder's profit is the extracted MEV, not block rewards.

SUAVE is a specialized chain designed for optimal transaction ordering. It centralizes the intelligence of MEV, creating a dominant mempool where searchers and builders compete. This does not prevent MEV; it creates a more efficient, transparent, and potentially centralized marketplace for it.

The shift is from miners to bundlers. In a PBS/SUAVE world, the power resides with the entities controlling the most sophisticated transaction ordering algorithms and access to liquidity. This is the domain of firms like Flashbots, bloXroute, and specialized searcher collectives.

Evidence: Ethereum's transition to PoS and the adoption of MEV-Boost demonstrates this shift in practice. Over 90% of Ethereum blocks are built by a handful of professional builders, not the validators who propose them. The extraction persists; the actors change.

Bundlers become the new miners. In a post-PBS world, block builders on Ethereum consolidate MEV, but account abstraction moves this function to the application layer. Bundlers in ERC-4337 and SUAVE-like shared sequencers execute user intents, becoming the primary extractors of cross-domain MEV.

Intent-based architectures redistribute value. Unlike transaction-based systems, intent-centric protocols like UniswapX and CowSwap outsource execution to solvers. This creates a competitive solver market where value accrues to the best executors, not the highest fee payer, fundamentally changing the MEV supply chain.

The stack professionalizes into verticals. Specialized firms like Flashbots and bloXroute will dominate different layers: searchers find opportunities, builders construct bundles, and relays ensure censorship resistance. This professional MEV supply chain increases efficiency but risks centralization in a few sophisticated players.

Evidence: Flashbots' MEV-Share and MEV-Boost already capture over 90% of Ethereum blocks, demonstrating the inevitability of specialized extraction. The next phase extends this model to intent settlement across rollups via protocols like Across and LayerZero.