MEV Infrastructure: Flashbots and Block Builders in 2024

Frequently Asked Questions

01.What is MEV and why does it matter to investors?

Maximal extractable value (MEV) is the profit a block producer can capture by ordering, including, or excluding transactions within a block. It matters to investors because it is a recurring revenue stream in the Ethereum supply chain, captured by searchers, builders, and validators, and because the infrastructure that routes it, such as Flashbots MEV-Boost, has become near-universal among validators. MEV exposure also affects the net yield of staking and the execution quality of any on-chain strategy.

02.What is the difference between Flashbots and MEV-Boost?

Flashbots is the research and software organisation that built much of the MEV supply-chain tooling. MEV-Boost is the specific open-source software that lets a validator outsource block building to a competitive marketplace of builders through relays. Flashbots operates one of the largest relays, but MEV-Boost is relay-agnostic, so a validator can connect to several relays. The distinction matters because Flashbots is an entity while MEV-Boost is neutral middleware adopted across the validator set.

03.Where does MEV value accrue in the supply chain?

MEV value is split across three roles. Searchers find profitable transaction bundles and bid for inclusion. Builders assemble the most valuable block from those bundles and competing transactions. Validators receive the winning bid as additional yield on top of issuance and priority fees. In early 2023 the largest share of extracted value flowed to validators, with smaller shares to builders and searchers, which is why MEV is often framed as a staking-yield enhancement rather than a standalone business.