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I have another question. Why would a centralized relay (flashbots) NOT take advantage of all the orders it processes? As far as I can tell, the MEV has just m

• meltedcapacitor 4y ago
  Reputation? Folks will stop sending them their TX if they never come out in blocks, but competing copy TX with someone else's address systematically do. So that they do their job is, to a degree, verifiable. It's a small community who all know each other, so antisocial behaviour can be punished using traditional village politics technology.
  • danuker 4y ago
    Well, the reputation I now perceive is "abysmal", because everything is served through Cloudflare. That means Cloudflare can capture or sell the advantage also, unnecessarily.
• belltaco 4y ago
  The article says it's altruistic.
  • bostik 4y ago
    Not quite. It says this "may be altruistic". "May" does a lot of heavy lifting there. From an outsider's perspective, a more likely explanation is that the funding is a subsidy. The VC having a stake in this space would have invested in a lot of other companies too. If their funding for Flashbots is notably less than the aggregate expected value of their total investment in the ecosystem at large, and if without Flashbots that expected value would drop by more than the funding amount, then the subsidy would be a net positive investment for that VC. In other words, they may have seen Flashbots as an ongoing cost of doing business. And if they had indeed achieved staying centralisation, there's always the access fee structure to hike up.