In the nearly two weeks since the Ethereum Merge took place, ~25 per cent of all blocks added to the network have been built by mev-boost relays that adhere to OFAC requirements, according to an analysis by Labrys, an Australian on-shore blockchain development agency. This means censoring Tornado Cash transactions and not allowing transactions from sanctioned addresses as designated by OFAC.
Labrys has been internally tracking protocol-level censorship since the Merge and has been concerned by what it has discovered. The company is releasing MEV Watch, a dashboard tool, to help raise awareness of the issue that no one seems to be talking about.
Mev-boost is a new addition to the Ethereum ecosystem, released around the time of the Merge, that allows Proof-of-Stake Validators to outsource production of blocks to the highest bidder, allowing Ethereum stakers to boost their overall APR an extra ~1.5 per cent (at present).
Ethereum Validators may choose to accept blocks from certain mev-boost relays. At present, just seven relay networks exist and only three do not perform any type of censorship. So far, 82.5 per cent of all blocks built by mev-boost relays have been built by the OFAC-compliant Flashbots relay, which creates not only concern of censorship but also of centralisation.
“It is concerning to see how quickly the potential for censorship has grown unchecked since the Merge and it’s projected to get much worse as more validators enable mev-boost unless awareness is raised. It is critical for the long-term success of the entire blockchain industry, not just Ethereum, that Layer 1 blockchains remain credibly neutral. This is why we are releasing MEV Watch to help correct course,” stated Labrys’ CEO, Lachlan Feeney.
All of this comes less than a month after the Ethereum industry threatened to slash validators like Coinbase if they were to comply with OFAC requirements directly in the blocks their validators built. These threats were directed at Coinbase due to their large stake in the network and potential to censor 12.5 per cent of the PoS blocks, yet over 25 per cent of blocks are already OFAC compliant thanks to mev-boost.
Potential censorship isn’t the only quirk that’s come out of the introduction of mev-boost. Earlier this week we witnessed an individual who used mev-boost to purchase an entire block for themself, preventing all other transactions from being included in that block for just 0.0002 ETH in gas fees.
The user included a hidden message in the block stating “Hello friends, it’s me, MevRefund! This block is mine. All mine. No other transactions are allowed. Get your own block!” Whilst this particular attempt was likely in jest to see what’s possible, it raises new concerns about how easy it might be under mev-boost to ‘halt the chain’ by purchasing block space.