Proposer-Builder Separation with Censorship Resistance (PBS-CR)

Proposer-Builder Separation with Censorship Resistance (PBS-CR) is a blockchain protocol design that decouples the role of the block proposer (who chooses the canonical chain) from the block builder (who assembles transaction content) and incorporates cryptographic mechanisms to guarantee transaction inclusion. This separation aims to mitigate centralization risks in block building (like MEV extraction) while using commit-reveal schemes or cryptographic commitments to prevent builders from censoring specific transactions. The proposer's primary role shifts to selecting the most valuable block header from builders without seeing its full, potentially censored, contents.

The censorship resistance component is typically enforced through a builder commitment. A builder must cryptographically commit to including all transactions from a publicly known crList (censorship resistance list) provided by the proposer. After the block is built and the header is chosen, the builder reveals the full block body. The protocol can then cryptographically verify that all transactions from the crList are present, slashing the builder's stake if they are not. This creates a strong economic disincentive against transaction filtering based on origin or content.

PBS-CR directly addresses the maximal extractable value (MEV) landscape. By creating a specialized market for block building, it allows for efficient MEV extraction by sophisticated builders while redistributing a portion of this value to protocol stakers via the proposer. This design seeks to democratize MEV profits that might otherwise be captured solely by the largest staking pools, who would act as combined proposer-builders in a naive implementation. Protocols like Ethereum are actively researching PBS-CR designs, such as those involving enshrined proposer-builder separation (ePBS), to enhance network neutrality and decentralization.

Implementing PBS-CR introduces new cryptographic and game-theoretic challenges. It requires secure commit-reveal protocols to prevent front-running and ensure builder accountability. The system must also design fair and efficient builder markets for header bidding. Furthermore, the security model must account for potential collusion between proposers and builders to bypass crList obligations. These complexities make PBS-CR a significant research and engineering undertaking, positioning it as a potential cornerstone for the next generation of resilient, neutral, and decentralized blockchain networks.

Proposer-Builder Separation with Censorship Resistance (PBS-CR) is a blockchain protocol design that separates the roles of block proposer (validator) and block builder (specialized searcher) while enforcing that validators cannot censor transactions. In this model, builders compete in a sealed-bid auction to create the most profitable block bundle, which includes a fee for the proposer. The winning block is then cryptographically committed to by the proposer before its contents are fully revealed, a process known as a commit-reveal scheme. This prevents the proposer from discriminating against transactions based on their content or origin.

The core mechanism enabling censorship resistance is the integration of a crList (censorship resistance list). After the builder's block header is committed, the proposer can publish a list of transactions that were seen in the public mempool but excluded from the builder's block. A subsequent builder, often in the next slot, is then obligated to include these transactions, provided they are valid and pay sufficient gas. This creates a credible threat that censored transactions will eventually be included, disincentivizing builders from engaging in censorship in the first place to maintain their reputation and profitability.

Implementation of PBS-CR relies on advanced cryptographic techniques. A key component is builder authentication, which ensures that only the winning builder can reveal the full block body that corresponds to the committed header. This is typically managed through a threshold encryption scheme, where a decentralized committee of encryption stewards holds decryption keys. The system is designed so that if a builder fails to reveal their block, the committee can collaboratively decrypt it after a delay, ensuring chain liveness and finalizing the proposer's payment.

The primary motivation for PBS-CR is to counteract the censorship risk inherent in the basic Proposer-Builder Separation (PBS) framework. In PBS, specialized block builders compete to create the most profitable block, which a block proposer (validator) then simply signs. This creates a centralization vector: a dominant builder or a malicious proposer could systematically exclude (censor) certain transactions, such as those from privacy mixers or sanctioned addresses, undermining the network's neutrality and permissionless nature.

A secondary, critical driver is proposer centralization and MEV extraction. Without PBS-CR, validators with sophisticated operations can extract Maximal Extractable Value (MEV) directly, creating a significant economic advantage. This leads to centralization pressures, as larger staking pools can afford advanced MEV tooling. PBS aims to democratize access to MEV by outsourcing block construction to a competitive builder market. PBS-CR ensures this separation is robust by preventing proposers from tampering with or censoring the builder's submitted block after the fact.

The context for PBS-CR's development is Ethereum's post-Merge evolution, where consensus-layer validators are responsible for block production. The protocol-native enshrined PBS vision includes PBS-CR as a core component to make censorship economically irrational or technically infeasible. It transforms the role of the proposer from a potential active censor into a passive, credibly neutral party that commits to including the best available block, as determined by a transparent auction.

Implementing PBS-CR is therefore essential for upholding Ethereum's core values of credible neutrality and permissionlessness. It ensures the network remains resistant to external coercion (e.g., regulatory demands to filter transactions) and internal centralization forces, securing the long-term health and decentralized integrity of the blockchain. Without it, PBS could inadvertently create powerful, censorable choke points in block production.