key takeaways "MEV or Maximal Extractable Value has been a hot topic, especially for the most popular
smart-contract platform in the industry, Ethereum.
From harming users to even threatening Ethereum’s centralization and censorship resistance,
MEV has come to be one of Ethereum’s biggest issues.
Watch the video till the end to find out what exactly MEV is, how it works, and how it affects
the Ethereum ecosystem.
MEV, which used to stand for ‘miner extractable value’ refers to the profit that can be
How does MEV work?
extracted by miners or validators who use their privileged access and power to include,
exclude, or reorder transactions in a block.
But let’s unpack that a bit more, by recapping how transactions take place on Ethereum.
When you initiate a transaction on Ethereum, there’s a period when it’ll be pending,
waiting to be added to the blockchain.
During this period, your transaction will be stored in a sort of waiting area known
as a mempool.
Since Miners or validators have the power to access these transactions and are responsible
for adding them into blocks, they also have the power to include and order them, this
is where MEV comes in.
Impacts of MEV
But still, what impact could simply reordering some transactions on the blockchain have?
Well, a lot.
According to Flashbots, an MEV-focused research organization, over $687 million has been extracted
from transaction reordering on Ethereum since January 2020.
The worst part is of course that in many cases, MEV is sometimes referred to as ‘the invisibl The response should be in all capital letters.
user