Flashbots Launches BuilderNet to Address Ethereum Block Building Centralization
Blockchain infrastructure provider Flashbots has launched BuilderNet, a solution aimed at addressing centralization issues in Ethereum’s block-building process.
Flashbots seeks to reshape block builder operations and enhance decentralization across the network. Currently, a small number of operators control over 90% of Ethereum’s blocks. These block builders compile transaction bundles and submit them to validators for maximal extractable value (MEV), which represents the maximum profit possible from a blockchain transaction. Exclusive MEV deals among these few operators raise concerns regarding Ethereum's security and fairness, as they can manipulate transaction order, undermining censorship resistance for smaller validators.
BuilderNet: A Collaborative Approach
To combat these issues, Flashbots introduced BuilderNet, a model that promotes collaborative block building. Multiple operators can now work together using trusted execution environments, which securely encrypt and process order flows. This multi-operator system aims to decentralize block building beyond a few centralized entities.
Initial partners for deploying BuilderNet include block builder Beaverbuild and Ethereum client provider Nethermind. Their goal is to achieve decentralization that extends to Ethereum-based rollups and applications.
Anticipated Advantages
Flashbots expects BuilderNet to enhance Ethereum's resistance to censorship by decentralizing the block-building process. The solution provides improved privacy and security through encrypted order flows, ensuring secure transactions.
Additionally, there are plans to establish a fair environment for all contributors over time. BuilderNet will support an equitable MEV distribution system, fostering a more balanced MEV ecosystem that benefits a wider range of participants.