Crossing the Dark Forest: The Most Comprehensive Overview of the Current MEV Market Landscape
TechFlow Selected TechFlow Selected
Crossing the Dark Forest: The Most Comprehensive Overview of the Current MEV Market Landscape
As blockchain technology continues to evolve, MEV has become a topic of growing interest.
Navigating Web3 tides with focused insightsWritten by: Ali
Compiled by: TechFlow
As blockchain technology continues to evolve, MEV has become an increasingly prominent topic. The MEV market is a complex and rapidly developing space, so the taxonomy introduced in this article may evolve over time. Nevertheless, researcher Ali provides here a detailed map of the MEV landscape, exploring the intricate world across three distinct categories:
1. Infrastructure;
2. Solutions;
3. Applications.
I. Infrastructure Layer
Starting with the infrastructure layer, which consists of "validators and staking participants." As anticipated in our earlier MEV research, the emergence of MPSVs (MEV profit-sharing validators) has reshaped the market landscape—many validators now offer enhanced MEV rewards in addition to traditional staking yields. We observe rising adoption of MPSVs and LSDs distributing MEV rewards across different chains. Notable validators providing MEV rewards to stakers include Cogent, Chainflow, Chorus One, and Stakefish.
Similarly, on the LSD side, numerous protocols are distributing MEV rewards among stakers, such as Manifold, Frax, Rocketpool, Laine (StakeWiz), Marinade Finance, and Lido. These market participants offer MEV rewards alongside returns from pure staking.
Above this subcategory, we find core block builders and relays. Block builders are highly specialized actors who construct blocks based on transaction ordering flows (public transactions, bundled transactions, private transactions, etc.). Relays receive blocks from builders and select the one that maximizes profit for the current proposer.
Within the block builder category, there are unique players such as Skip Protocol (Cosmos), which offers sovereign MEV infrastructure. Sovereign refers to Skip building modular tools that allow app-chains full control and customization over transaction preference rules. Another example is Jito, which operates as an MPSV and also issues its own liquid staking derivative, jSOL.
Each blockchain ecosystem typically has its own MEV block builder provider (Ethereum may have multiple). Examples include: Skip / Cosmos, Jito / Solana, Flashbots / Ethereum, Fastlane / Polygon. Two key insights emerge from this analysis:
- We expect existing (or new) blockchain ecosystems to continue developing their own unique block builder providers. Leaders may emerge within individual chains, benefiting from growing economies of scale.
- There is a clear demand for cross-chain MEV solutions, which should lead to collaborations with existing block builders to meet this need.
II. MEV Solutions
MEV solutions encompass a range of tools and protocols designed to help extract, prevent, or democratize MEV across the ecosystem. One of the most compelling subcategories here is cross-chain MEV coordination, led by innovators like Skip Protocol, Suave, and Anoma. Growing popularity of cross-chain interoperability, composability, and modularity naturally paves the way for new types of cross-chain and inter-block MEV solutions.
Another interesting subcategory is (shared) sequencers, focused on Layer 2 scaling solutions. Shared sequencers mitigate MEV-related risks by enabling fair and consistent transaction ordering, thereby limiting opportunities for frontrunning and bot exploitation of profitable trades.
Other emerging areas include NFT-specific MEV solutions such as Pikapool, aiming to create a dedicated NFT mempool and reduce negative externalities from MEV. Additional NFT-focused tools include sniping and scarcity query tools, which arbitrageurs can leverage to maximize profits and trade NFTs.
Finally, we believe a nascent category beginning to take shape will be the market for game-oriented MEV tools.
Blockchain gaming is particularly interesting because it often involves DeFi (i.e., gaming tokens) and NFTs (i.e., in-game assets). As innovation grows in the gaming space and the crypto gaming industry matures, we believe the timing is ripe for MEV to enter. We’ve seen MEV penetrate DeFi, then NFTs—given that NFTs are central components of on-chain games, it’s natural for MEV to play a crucial role here, especially concerning user experience. Existing MEV players will likely capture this market, or we may see entirely new entrants emerge.
Early long-tail examples of game-related MEV include mgnr, which developed a free market to sell locked $JEWEL tokens from Defi Kingdoms—opening doors to various arbitrage opportunities for illiquid gaming tokens.
III. MEV Application Layer
The application layer includes end-user products spanning the MEV ecosystem. On one hand, many DEXs and aggregators emphasize MEV prevention. On the other hand, various markets and trading platforms frequently encounter MEV arbitrage and liquidations.
We’re also seeing an intriguing niche emerge: specialized markets for blockspace and order flow payments. Examples include Alkimiya and DFLOW. It will be fascinating to observe how these markets are utilized and what novel use cases arise from them.
We anticipate two significant categories emerging in this layer:
-
NFT and gaming marketplaces offering MEV protection. Instances of NFT MEV include bot activity during mints, arbitrage opportunities around floor prices, or liquidations in NFT lending. In terms of prevention, we refer specifically to mitigating bot manipulation. As previously noted, the rising popularity of on-chain gaming will likely introduce various forms of MEV into this domain. Therefore, gaming platforms must adapt their protocols to address these challenges.
-
MEV wallets. Wallets serve as the gateway between users and decentralized applications. We expect wallets to begin collaborating with MEV solution providers or block builders to help users reclaim MEV slippage they might otherwise incur—even capturing new forms of MEV.
In conclusion, the MEV market map offers a comprehensive overview of the complex and dynamic world of MEV. As the market continues to evolve, we remain committed to refining and updating this resource in collaboration with the broader community. Together, we can navigate the "dark forest" of MEV and illuminate a path toward a more transparent, secure, and equitable blockchain ecosystem.
Join TechFlow official community to stay tuned
Telegram:https://t.me/TechFlowDaily
X (Twitter):https://x.com/TechFlowPost
X (Twitter) EN:https://x.com/BlockFlow_News
Ali
