Proposer-Builder Separation (PBS) is a blockchain architecture that formally separates the role of the block proposer (or validator) from the block builder. In this model, specialized builders compete in a marketplace to construct the most profitable blocks by including transactions and MEV (Maximal Extractable Value) opportunities, while independent proposers are responsible for selecting and attesting to the winning block. This separation is a direct response to the centralizing forces of MEV, where validators with sophisticated infrastructure could gain disproportionate rewards and influence. PBS aims to democratize access to MEV profits and enhance network security by preventing a single entity from controlling both block creation and finalization.
Proposer-Builder Separation (PBS)
What is Proposer-Builder Separation (PBS)?
A design paradigm that decouples the roles of block proposal and block construction to improve network efficiency and mitigate centralization risks.
The core mechanism enabling PBS is a commit-reveal scheme or an open marketplace. Builders submit encrypted block bids to proposers, containing both the proposed block and a fee (the bid) for the proposer. The proposer, often selected by the underlying consensus protocol (e.g., Ethereum's beacon chain), simply chooses the bid offering the highest fee without viewing the block's contents. After the proposer commits to a bid, the winning builder reveals the full block for network validation. This process, sometimes implemented via a builder API or a specialized relay, ensures proposers cannot front-run or censor transactions within the builder's block, as they only see the associated bid.
PBS introduces several critical benefits to blockchain ecosystems. It reduces centralization pressure by allowing smaller validators to capture MEV rewards through fair competition among builders. It enhances censorship resistance by making it economically irrational for a proposer to reject a highly profitable, valid block. Furthermore, it improves network efficiency by enabling builders to use optimized hardware and complex algorithms for transaction ordering and MEV extraction, which individual validators may not possess. On Ethereum, PBS is a foundational concept for the post-merge roadmap, with implementations like mev-boost serving as a temporary, off-protocol version guiding the development of a native, in-protocol solution.
Key Features of PBS
Proposer-Builder Separation (PBS) is a protocol design that decouples the roles of block proposal and block construction to improve network efficiency and censorship resistance.
Role Specialization
PBS creates two distinct, specialized roles:
- Block Proposer (Validator): Responsible for proposing a block header and attesting to its validity. Their role is simplified to selecting the best available block from builders.
- Block Builder: Specialized entity that constructs the full block content, including ordering transactions and maximizing extractable value (MEV). This role requires sophisticated infrastructure and capital. This separation allows each role to optimize for different skills and resources.
MEV Auction Mechanism
The core economic engine of PBS is a sealed-bid, first-price auction. Builders compete by submitting bids (a portion of the block's total value) to the proposer.
- Builders construct blocks privately, bundling user transactions with MEV opportunities.
- They submit a bid commitment and a block header to the proposer.
- The proposer selects the header with the highest bid, without seeing the full block contents, ensuring a trust-minimized selection process.
Censorship Resistance
PBS introduces crLists (censorship resistance lists) to mitigate builder-level censorship. Validators can specify a list of transactions that must be included if valid, forcing builders to incorporate them.
- This protocol-level tool prevents builders from excluding transactions based on origin or content.
- It ensures the network's credibly neutral base layer properties are maintained, even with specialized, profit-maximizing block builders.
Trust-Minimized Execution
PBS uses cryptographic commitments to ensure proposers can select the most valuable block without seeing its contents, preventing theft of MEV strategies.
- Builders submit a block header hash and a bid.
- After the proposer commits to a header, the builder reveals the full block.
- The protocol verifies the revealed block matches the commitment. This commit-reveal scheme is critical for maintaining a fair and secure auction.
Protocol vs. In-Protocol
PBS can be implemented in two primary ways:
- In-Protocol PBS (ePBS): The separation and auction are enforced directly by the blockchain consensus rules. This is the end goal for maximal decentralization and liveness guarantees.
- Protocol PBS (via MEV-Boost): An interim, out-of-protocol implementation used by Ethereum. Relays facilitate a marketplace between proposers and builders. While effective, it introduces additional trust assumptions compared to a native, in-protocol solution.
Builder Ecosystem & Relays
In current implementations (e.g., MEV-Boost), a critical third party emerges: the Relay.
- Function: Acts as a trusted intermediary that receives block bids from builders and forwards them to proposers. It validates builder submissions to protect proposers from invalid blocks.
- Builder Market: Specialized firms (e.g., Flashbots, bloXroute) operate builder software, competing on their ability to identify and capture MEV through advanced algorithms and transaction bundling.
How Proposer-Builder Separation Works
Proposer-Builder Separation (PBS) is a key architectural redesign of blockchain consensus that decouples the roles of block *proposal* and block *construction* to enhance network efficiency and mitigate centralization risks.
Proposer-Builder Separation (PBS) is a blockchain protocol design that formally separates the role of the block proposer (or block producer) from the block builder. In this model, the proposer is responsible for selecting the next block to be added to the chain, but does not construct it. Instead, specialized builders compete in a marketplace to create the most profitable or desirable block contents, which are then submitted to the proposer for inclusion. This separation creates a distinct market for block space, allowing for more sophisticated and optimized block construction.
The core mechanism enabling PBS is a commit-reveal scheme, often implemented via a builder auction. In this process, builders create full block candidates and submit cryptographic commitments (bids) to the proposer. The proposer, often chosen through the underlying consensus mechanism like proof-of-stake, then selects the block with the most valuable bid, typically the one offering the highest payment to the proposer. This payment is known as the MEV (Maximal Extractable Value) reward or simply the builder's bid. The winning builder's block is then revealed and proposed to the network.
PBS addresses critical issues in modern blockchains, primarily MEV centralization. Without PBS, validators who propose blocks have both the incentive and the ability to extract MEV themselves, leading to a competitive advantage for sophisticated, centralized operators. By outsourcing block construction to a competitive builder market, PBS democratizes access to MEV extraction and can reduce the centralizing pressure on the validator set. It also allows proposers (often smaller validators) to capture a fair share of MEV revenue without needing complex infrastructure.
A canonical implementation of PBS is Ethereum's proposed enshrined PBS, part of its post-merge roadmap. In this design, the separation is baked directly into the consensus layer protocol. Builders submit execution payloads (the transaction bundle) with bids to the beacon chain. A related, interim solution is MEV-Boost, a middleware that allows Ethereum validators to outsource block building to an external marketplace of builders, effectively implementing PBS in practice before it is fully enshrined in the protocol.
The PBS architecture introduces new roles and considerations. Relays are trusted intermediaries in systems like MEV-Boost that receive blocks from builders and deliver them to proposers, ensuring fairness and preventing certain attacks. Furthermore, PBS shifts the trust model and creates a need for crtic lists and builder reputation systems to prevent malicious or censoring blocks from being built. The long-term goal is to create a robust, permissionless builder market that maximizes chain efficiency and value for users and validators alike.
Primary Motivations for PBS
Proposer-Builder Separation (PBS) was designed to address critical economic and security challenges inherent in the original proof-of-stake (PoS) design. These are the core problems it aims to solve.
Mitigate MEV Centralization
Without PBS, validators who propose blocks have a monopoly on Maximal Extractable Value (MEV), creating a powerful economic incentive to centralize stake and hardware to outcompete others. PBS separates the role of block building (finding MEV) from block proposing (signing the header), distributing the economic rewards and reducing the centralizing pressure on validators.
Reduce Validator Hardware Requirements
Sophisticated MEV extraction requires powerful, specialized hardware and complex software to run searcher bots and simulate thousands of transaction bundles. PBS allows validators (proposers) to outsource this intensive work to a competitive market of block builders, enabling validators to run on consumer-grade hardware, which promotes decentralization.
Enhance Censorship Resistance
A single entity controlling both block building and proposing can easily censor transactions. PBS introduces a commit-reveal scheme where the proposer only sees a block header commitment, not the full transaction list. This makes it harder for a proposer to know which transactions are being censored by the builder, creating a layer of accountability.
Improve Block Efficiency & Value
PBS creates a competitive marketplace where specialized builders compete to create the most valuable block (highest bid) for the proposer. This competition drives innovation in MEV optimization and transaction ordering, leading to more economically efficient blocks and higher rewards for both builders (via MEV) and proposers (via the winning bid).
Simplify Protocol Complexity
By externalizing the complex, stateful process of block construction to an off-protocol market, the core Ethereum consensus protocol can remain simple and robust. The protocol only needs to verify the validity of a block header and enforce the PBS auction rules, rather than managing in-protocol transaction ordering logic.
Enable Credible Neutrality
PBS aims to make the block proposal role more credibly neutral. The proposer's job is reduced to accepting the highest bid from a permissionless builder market, rather than making subjective decisions about transaction inclusion or ordering. This reduces the proposer's ability to act as a gatekeeper.
Ecosystem Usage & Implementations
Proposer-Builder Separation (PBS) is a blockchain architecture that decouples block proposal from block construction to enhance censorship resistance and decentralization. Its implementation varies across protocols and layers.
In-Protocol PBS (ePBS)
Enshrined Proposer-Builder Separation (ePBS) aims to integrate PBS directly into Ethereum's consensus layer, removing reliance on off-protocol trust. Key goals include:
- Eliminating the need for trusted relays by using cryptographic commitments.
- Formally separating the roles within the protocol for stronger security guarantees.
- Proposals like Builder Override of Forkchoice (BOF) and Two-Slot PBS are active research areas to achieve this.
Cosmos SDK's ABCI & Block SDK
The Cosmos ecosystem enables PBS-like designs through its flexible Application Blockchain Interface (ABCI). The Block SDK is a framework that modularizes the block construction process:
- Allows for dedicated Lane modules (e.g., for MEV, free transactions) that builders can optimize.
- The proposer selects the highest-paying, valid block from competing builders.
- This provides a native, app-chain specific path to implement separation of duties.
SUAVE: A Dedicated PBS Chain
Single Unified Auction for Value Expression (SUAVE) is a specialized blockchain envisioned as a decentralized block builder. It aims to be a neutral marketplace for:
- Preference Expression: Users and searchers express transaction preferences and bids.
- Cross-Chain MEV: Building optimal blocks for multiple connected chains (Ethereum, rollups).
- By centralizing builder logic in its own chain, SUAVE seeks to democratize access to block building.
Rollup-Specific Implementations
Optimistic and ZK Rollups often implement simplified PBS models within their sequencer designs:
- Shared Sequencer Networks: Decentralized networks (e.g., Astria, Espresso) act as builders, producing blocks for multiple rollups.
- Based Sequencing: Rollups can outsource block building to the underlying L1 (e.g., Ethereum) proposers.
- These models trade off decentralization for efficiency, reducing the centralization risk of a single sequencer.
Comparison: Traditional vs. PBS Architecture
Contrasts the integrated block production model with the decoupled architecture of Proposer-Builder Separation.
| Architectural Feature | Traditional (Integrated) Model | PBS (Decoupled) Model |
|---|---|---|
Primary Actor | Proposer-Validator | Proposer (Validator) & Separate Builder |
Block Construction Responsibility | Validator | Specialized Builder |
MEV Extraction & Ordering | Performed by the validator | Auctioned to the highest-bidding builder |
Revenue Flow | Validator captures all transaction fees and MEV | Validator receives bid; Builder captures residual MEV |
Censorship Resistance | Relies on individual validator ethics | Enhanced via inclusion lists (crLists) and builder diversity |
Protocol Complexity | Lower | Higher (requires auction mechanism, relay network) |
Hardware Requirements for Validators | Moderate (must run performant node) | Lower (can outsource compute-intensive block building) |
Market Specialization | Limited | High (enables professional, competitive builder market) |
Common Misconceptions About Proposer-Builder Separation (PBS)
Proposer-Builder Separation (PBS) is a critical architectural upgrade for Ethereum's consensus layer, but its design and implications are often misunderstood. This section clarifies frequent points of confusion.
Proposer-Builder Separation (PBS) is a protocol design that decouples the role of block proposal from block construction to mitigate centralization risks from Maximal Extractable Value (MEV). In a PBS model, specialized actors called block builders compete in an auction to create the most valuable block by including and ordering transactions. The winning builder's block is then cryptographically committed to a block proposer (typically a validator), who simply signs and publishes it to the network. This separation prevents proposers from being influenced by complex MEV strategies they cannot execute, ensuring the builder market is competitive and open.
Technical Details & Mechanics
Proposer-Builder Separation (PBS) is a blockchain architecture that decouples the roles of block proposal and block construction to mitigate centralization risks and improve network efficiency.
Proposer-Builder Separation (PBS) is a blockchain design pattern that splits the traditional validator role into two distinct entities: a block proposer (or proposer) who is responsible for selecting and proposing the next block, and a block builder (or builder) who is responsible for constructing the block's contents, including ordering transactions and maximizing extractable value (MEV). The proposer selects the most profitable block from a competitive, sealed-bid auction run by builders, thereby outsourcing the complex task of block construction. This separation is designed to democratize access to block production, as proposers can be lightweight nodes, while allowing specialized builders to compete on efficiency and MEV extraction.
Frequently Asked Questions (FAQ)
Proposer-Builder Separation (PBS) is a critical architectural shift in blockchain design. These FAQs address common questions about its purpose, mechanics, and impact on network participants.
Proposer-Builder Separation (PBS) is a blockchain design pattern that decouples the roles of block proposal and block construction to improve network efficiency and mitigate centralization risks from Maximal Extractable Value (MEV). In a PBS model, specialized actors called block builders compete to create the most profitable block by including and ordering transactions, while block proposers (validators) simply select and attest to the most valuable block from a public marketplace. This separation allows validators to outsource the complex and resource-intensive task of MEV extraction to a competitive market of builders, theoretically leading to more optimal block production and a fairer distribution of MEV profits.
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