Block Producer Surplus refers to the economic benefit accrued by entities responsible for validating transactions and creating new blocks on a blockchain, beyond their direct operational costs. This surplus typically comprises transaction fees and block rewards. It represents the profitability derived from their participation in securing and maintaining the network.
Context
In proof-of-stake and delegated proof-of-stake blockchain systems, block producer surplus is a key metric for understanding network economics and validator incentives. News analysis often examines how changes in network activity or protocol design impact this surplus, influencing the decentralization and security of the network. Debates sometimes arise regarding the concentration of this surplus and its implications for network fairness.
The SAKA mechanism resolves the TFM impossibility theorem for active block producers by integrating MEV searchers to ensure incentive compatibility and welfare.
Foundational impossibility theorem on transaction fee mechanisms is circumvented by SAKA, a new design securing 50% welfare and full incentive compatibility.
A new game-theoretic mechanism, SAKA, circumvents a fundamental impossibility result, achieving incentive-compatibility and 50% welfare for transaction ordering.
This new batch-clearing AMM mechanism formally eliminates miner extractable value by settling all trades at a single price, ensuring strategy-proof execution.
The SAKA mechanism is a novel game-theoretic solution that achieves incentive compatibility across users and block producers while guaranteeing half of the maximum social welfare.
An impossibility proof shows no single TFM can align incentives for both users and active MEV-extracting block producers, mandating external design augmentation.
We use cookies to personalize content and marketing, and to analyze our traffic. This helps us maintain the quality of our free resources. manage your preferences below.
Detailed Cookie Preferences
This helps support our free resources through personalized marketing efforts and promotions.
Analytics cookies help us understand how visitors interact with our website, improving user experience and website performance.
Personalization cookies enable us to customize the content and features of our site based on your interactions, offering a more tailored experience.
