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Briefing

This paper addresses the challenge of Maximal Extractable Value (MEV) as an external, often inequitable, revenue stream for Ethereum validators. It introduces Execution Tickets, a novel protocol-native mechanism enabling the Ethereum protocol to directly broker MEV, internalizing this value extraction. This breakthrough fundamentally redefines validator compensation and creates a new Ethereum native asset, fostering a more equitable value distribution and enhancing the network’s overall security and economic resilience. The system transforms MEV from a parasitic externality into a managed, integrated protocol function.

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Context

Before this research, Maximal Extractable Value (MEV) operated largely as an opaque, external market. Validators and block producers extracted this value through transaction reordering, insertion, and censorship, creating potential for centralization risks and an uneven distribution of protocol-generated value. This prevailing challenge necessitated new approaches to integrate MEV management directly into the core blockchain architecture.

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Analysis

The core mechanism proposed is the “Execution Ticket” system, a novel protocol primitive within Ethereum. This system allows the protocol itself to issue and manage tickets representing the right to propose execution payloads, effectively taking over the role of MEV brokering. This system offers a fundamental departure from prior approaches, which primarily relied on external market solutions or indirect mitigation strategies. Execution Tickets integrate MEV distribution directly into the protocol’s economic model, creating a transparent and predictable framework for value capture and redistribution.

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Parameters

  • Core Concept ∞ Execution Tickets
  • Proposed SystemEthereum Protocol-Native MEV Brokerage
  • Key Authors ∞ Jonah Burian
  • Target Blockchain ∞ Ethereum
  • Primary Impact Area ∞ Value Distribution and Network Security
  • Mechanism Type ∞ Novel Ticketing System

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Outlook

This research opens new avenues for protocol-level economic design, suggesting a future where blockchain networks proactively manage internal value flows. The potential real-world applications include more stable and predictable validator revenue streams, reducing the incentive for off-protocol MEV extraction, and fostering greater decentralization. It lays the groundwork for subsequent studies into optimizing native asset design and dynamic MEV allocation mechanisms.

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Verdict

The Execution Ticket system represents a profound architectural shift, transforming Maximal Extractable Value from an external market dynamic into an intrinsic, manageable protocol function for foundational blockchain integrity.

Signal Acquired from ∞ arXiv.org

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