Sequencer Bottleneck

Definition ∞ A Sequencer Bottleneck describes a point of congestion or centralization in the process of ordering and submitting transactions to a Layer 1 blockchain from a Layer 2 rollup. In many optimistic and ZK-rollups, a single sequencer currently holds the responsibility for batching transactions, executing them, and posting the data to the main chain. This centralized role, while efficient, introduces potential risks such as censorship, single points of failure, and opportunities for Maximal Extractable Value (MEV) exploitation. It limits the overall decentralization of the Layer 2 solution.
Context ∞ The sequencer bottleneck is a significant concern for the decentralization and censorship resistance of many operational Layer 2 rollups. Efforts are underway to decentralize sequencers through various mechanisms, including rotating committees, auction-based systems, and distributed networks of sequencers. Addressing this bottleneck is crucial for Layer 2 solutions to fully inherit the security and permissionless properties of their underlying Layer 1 blockchains. This represents a key area of ongoing research and development.