Definition ∞ Block Producer MEV, or Maximal Extractable Value, describes the profit a block producer can derive by including, excluding, or reordering transactions within the blocks they produce. This economic incentive arises from the ability to influence transaction order and content before a block is added to the blockchain. MEV represents the value that can be extracted beyond standard block rewards and transaction fees. It is a consequence of the permissionless nature of transaction submission and the sequential block production process.
Context ∞ The discussion surrounding Block Producer MEV is a central point of concern for blockchain fairness and decentralization, particularly in proof-of-stake systems. Efforts to mitigate its negative externalities, such as front-running and sandwich attacks, are ongoing through protocol design modifications like proposer-builder separation (PBS). Monitoring the impact of MEV on network health and transaction costs is a critical aspect of blockchain research and development.
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