Ethereum MEV Extraction and Rewards - Discussion & Policy Groundwork

Perhaps we can allow it; from my perspective It’s mostly about policy monitoring / adherence and security.

Monitoring
I don’t think there’s a way to guarantee that the minimal mandated list is at least included without actually proving that the blocks executed actually came from a relay within that list. @George can you please let me know if this is correct or not?

Basically in the monitoring system proposed, the Lido watchtower/monitoring system would (a) need to know which other relays these node operators are using, (b) be collecting data from those relays, (c) somehow confirm that in the case that a block came from from a relay not in the “minimum list” there were no blocks proposed by relays in the minimum list with block reward > processed block. If we could do this then I think it could work.

Security
In theory, part of the reason the reason for the searcher->builder->relay separation is that relays should be performing some kind of “checks and balances” on builders (e.g. if builders turn out to be bad / proposing bad blocks / not paying rewards, relays should blacklist them). And for our monitoring / security perspective, we rely on relays to be good actors or de-list them if not (even if their builders are at fault, since they are the proxy for builder-groups). If we have no control over the relays that an NO adds, then we cannot directly respond to possible attacks (we also introduce additional attack vectors because we can’t quality control the relays added).

Further, If you allow NOs to define their own relays, then we also have scenarios where NOs would potentially actually be running the relay(s) that they add. Doing so would allow the NO to peek into the contents of builder-proposed blocks, and therefore greatly increase the chance of cheating / taking some builder’s block. This would also allow an NO the possibility of running a builder + a relay which puts us back in the “NOs shouldn’t build+propose their own blocks” problem-space and introduces concerns around censorship resistance and side-channel payments for inclusion into blocks. Obviously this can still happen with a more controlled list of relays, but I would argue that the chances of it happening go down drastically given a good vetting process.

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