MEV is a relatively new phenomenon in crypto and some methods of MEV extraction result in a worse experience for the user, while other methods can help fix network inefficiencies. eking0x breaks down how it works:
”) and value extraction methods will continue after that transition, leading to the more inclusive term “maximal extractable value” that is commonly used today.notes that network miners or validators should get the full MEV amount, because they are the only party that can guarantee a MEV extraction is successful.
“Miners/validators do get a portion of the full MEV amount anyway because searchers are willing to pay high gas fees in exchange for a higher likelihood of inclusion of their profitable transactions in a block,” the foundations explains.Some searchers will use bots called “generalized front-runners” to scan the mempool for profitable transactions.
Some groups are working to use this activity for good. Flashbots runs a service that allows Ethereum users and miners to communicate their preferred transaction order within a block. This is meant to be a “fair ecosystem for efficient MEV extraction” and has reduced the effectiveness of generalized front-runners, according to the Ethereum Foundation.The term refers to a malicious type of front-running that is often used to manipulate cryptocurrency prices.
The sandwich attack will ultimately affect the amount of cryptocurrency the user who put in the initial transaction will receive, while the attacker will benefit from the price difference.
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