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BuilderNet launches to address Ethereum block centralisation issues

BuilderNet launches to address Ethereum block centralisation issues

GrafaGrafa2024/11/27 13:31
By:Mahathir Bayena

Blockchain infrastructure firm Flashbots has introduced BuilderNet, a decentralised block-building network on Ethereum (CRYPTO:ETH) aimed at reducing centralisation and preventing censorship.

The platform went live on November 26, addressing concerns about the dominance of block builders Beaverbuild and Titan Builder, who have constructed 88% of Ethereum’s blocks in recent weeks.

BuilderNet facilitates collaboration among multiple parties in block-building processes.

According to Shea Ketsdever, Flashbots’ product manager, the solution is live on Ethereum’s mainnet and will later expand to decentralised sequencing for Layer 2 networks.

Ethereum’s current proposer-builder separation (PBS) system allows builders to create blocks that proposers review and select based on profitability.

However, Ethereum co-creator Vitalik Buterin and Flashbots have highlighted centralisation and censorship as critical vulnerabilities in this model.

“The future of block building will be centralised unless we act now,” Flashbots emphasised.

MEV Watch data reveals that nearly 45% of Ethereum blocks have enforced compliance with the U.S. Office of Foreign Assets Control (OFAC) over the past five months.

Such practices can delay transaction inclusion, giving block builders opportunities to extract user revenue through methods like sandwich attacks.

BuilderNet addresses these challenges with a "multioperator" system, enabling multiple contributors to build blocks within a Trusted Execution Environment.

This structure ensures transparency and redistributes Maximal Extractable Value (MEV) back to users while compensating builders via a "refund rule."

Flashbots’ solution aims to enhance decentralisation and curb rent-seeking behaviors from centralised builders.

Currently operated by Flashbots, Beaverbuild, and Ethereum infrastructure firm Nethermind, BuilderNet plans to evolve into a permissionless system to further enhance censorship resistance.

Flashbots initially proposed a similar decentralised block-building framework, SUAVE, in 2022, but its full deployment did not materialise.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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