Extracting value from state transitions operates at the boundary between user transaction submission and block validation. By manipulating the transaction sequence within a block, searchers capture arbitrage opportunities that alter execution state.
The Lifecycle of a Mempool Sandwich Attack
Front-running and back-running rely on strict gas price ordering within public transaction pools. Searchers construct bundle payloads containing victim transactions bounded by custom buy and sell orders, ensuring guaranteed atomic execution without execution risk.
Decoupling Proposers from Builders via MEV Boost
To prevent validator centralization, the MEV-Boost architecture separates transaction selection from block header commitment. Builders compete in off-chain auctions to assemble complete blocks, transferring extracted value back to validators via blind relayers.
Protocol Level Mitigation and Encrypted Mempools
Mitigating execution toxicity requires structural changes to transaction ordering primitives. Implementing threshold encryption and commit-reveal schemes shifts the equilibrium away from toxic MEV, protecting user slippage on decentralized exchanges.