Formalizing MEV Theory for Provable Blockchain Security ∞ Research

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Briefing

Maximal Extractable Value (MEV) presents a pervasive challenge to public blockchains, manifesting as economic attacks where adversaries manipulate transaction ordering to extract value, often to the detriment of users and network stability. This paper introduces a foundational breakthrough ∞ a formal theory of MEV, grounded in a general, abstract model of blockchains and smart contracts. This theoretical framework provides the essential basis for developing provable security measures against MEV attacks, paving the way for more robust and equitable decentralized architectures.

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Context

Prior to this research, MEV was primarily understood through empirical observations and practical analyses of its manifestations in decentralized finance (DeFi) protocols. While the existence and impact of MEV were well-documented, a comprehensive and rigorous theoretical foundation was lacking. This absence hindered the ability to formally define, analyze, and, crucially, prove security against the diverse range of MEV attack vectors, leaving a significant gap in the academic understanding of blockchain economic security.

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Analysis

The paper’s core mechanism centers on the development of a formal theory of MEV, built upon an abstract model of blockchain systems and smart contracts. This model precisely defines the interactions between block producers, users, and smart contracts, allowing for a rigorous characterization of value extraction opportunities. This approach fundamentally differs from previous empirical studies by providing a mathematical framework to analyze MEV, moving beyond descriptive observations to enable a prescriptive understanding of how MEV attacks function and how their underlying vulnerabilities can be formally addressed within protocol design.

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Parameters

Core Concept ∞ Formal MEV Theory
New System/Protocol ∞ Abstract Blockchain Model
Key Authors ∞ Bartoletti, M. et al.
Publication Venue ∞ arXiv
Latest Revision ∞ May 2025

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Outlook

This foundational work opens significant avenues for future research and practical application. In the academic sphere, it provides a rigorous framework for further theoretical exploration into MEV dynamics and the formal verification of MEV-resistant protocol designs. Strategically, this theory is poised to unlock the development of next-generation blockchain architectures and DeFi protocols that are provably secure against value extraction, fostering a more resilient and trustworthy decentralized ecosystem within the next three to five years.

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Verdict

This foundational theory provides the essential framework for understanding and ultimately mitigating Maximal Extractable Value, critical for the long-term integrity of decentralized systems.

Signal Acquired from ∞ arxiv.org