From MEV-Boost to BuilderNet: Can True MEV Fair Distribution Be Achieved?

In MEV-Boost auctions, the key to winning the competition is not the strength of the algorithm, but the control over the most valuable order flow. BuilderNet allows different participants to share order flow, reshaping the MEV ecosystem.

Written by: 0XNATALIE

The Centralized Status Quo of Ethereum Block Building

Currently, the Ethereum block building market faces a highly centralized problem: about 92% of Ethereum blocks are built by MEV-Boost, and about 94% of these blocks are dominated by two main block builders (Beaverbuild and Titan).

Flashbots launched MEV-Boost originally to mitigate the scale effect of large staking pools extracting MEV, preventing large validators from expanding their competitive advantage with more MEV revenue, which would otherwise force small validators to join large staking pools and further centralize the network. MEV-Boost, through the Proposer-Builder Separation (PBS) mechanism, separates the proposing and building processes of blocks: block proposers (validators) are responsible for proposing new blocks, while block builders are responsible for transaction ordering and block construction. In this way, validators no longer participate directly in block building, but instead, independent builders are introduced to redistribute MEV and reduce the monopoly of large staking pools.

However, with the popularity of MEV-Boost, the block building market has instead become highly concentrated, with over 90% of blocks built by just two builders. This centralization not only erodes Ethereum’s decentralized nature but also leads to a vicious cycle of high participation costs, mainly in two aspects: First, order flow—the value of a block is determined by its order flow. To obtain this transaction data, builders need to sign exclusive agreements with order flow providers (such as users, wallets, applications, etc.), and these agreements often come with high fees. Without paying these fees, builders find it difficult to compete in the market. Such exclusive agreements allow a few builders to form monopolies with specific order flow providers, increasing system fragility, as the failure of any builder could impact the stability of the entire system. Second, block building requires significant capital investment in infrastructure (such as relays), further raising the participation threshold.

BuilderNet: Reshaping the MEV Ecosystem

To address these issues, Flashbots, Beaverbuild, and Nethermind have jointly developed BuilderNet, a decentralized block building network. By leveraging Trusted Execution Environments (TEE) and multiple independent nodes to collaboratively build blocks, BuilderNet can enhance Ethereum’s censorship resistance, decentralization, and transparency, and redistribute MEV to ensure all participants can benefit fairly.

Core Team

• Flashbots: A technical team focused on optimizing Ethereum MEV, dedicated to improving the transparency and decentralization of the block building market. Flashbots has developed protocols such as MEV-Boost and MEV-Share, providing more transparent and fair mechanisms for the block building market.
• Beaverbuild: A major Ethereum block builder and currently one of the largest, occupying about 50% of the market share.
• Nethermind: A company providing Ethereum client and infrastructure solutions, focusing on Ethereum protocol implementation, performance optimization, and security. Nethermind provides important technical support for BuilderNet, ensuring efficient operation and security of the system.

How It Works: TEE + Order Flow Sharing = Revenue Distribution by Contribution

BuilderNet relies on a decentralized multi-party collaboration model. In the traditional model, one node runs one block builder; in the BuilderNet model, multiple nodes jointly run one block builder.

Within a block builder, each node can run an independent block building instance in its own TEE. A TEE is a hardware-level secure environment that ensures the privacy of transaction data, preventing operators from tampering with transaction flows or leaking user data. Only authorized participants can verify and send encrypted transaction flows to these TEE instances. This approach ensures the privacy of transaction data and the security of the system. Each instance obtains order flow from the entire network and independently builds a complete block, while also sharing the order flow with other instances within the same builder. Then, all blocks are submitted to the MEV-Boost relay, and a bidding mechanism determines which block is ultimately included on-chain. The selected block will distribute refunds based on the contribution of each participant (such as applications, wallets, searchers, instances, etc.) that provided order flow for that block.

BuilderNet not only supports the Ethereum mainnet but also plans to introduce more features to L2 networks through Rollup-Boost. In the long term, as more users choose BuilderNet, large builders will also be inclined to join this platform. More transaction volume and more efficient operations will allow them to achieve more stable returns.

Participants

• Users, wallets, and applications: Can participate by sending transactions to BuilderNet nodes and receive refunds based on their contributions.
• Searchers: Can submit transaction bundles to BuilderNet and receive refunds while enjoying privacy protection. This provides independent searchers with the same economic returns and privacy protection as integrated searcher-builders.
• Builders (nodes): Independently run block building instances, submit blocks to MEV-Boost, and receive corresponding rewards based on their contributions.
• Validators: In the early stage of BuilderNet’s launch, the economic model for validators will not be significantly affected, as existing MEV revenue is usually not directly paid to validators. More MEV will be redistributed to validators in the future.
• Operators: Responsible for managing and maintaining the infrastructure of BuilderNet nodes and ensuring the proper operation of the TEE environment.