✨Solana MEV Fairytales ✨
Once upon a time @solana had a lot of spam
👺evil searchers spammed, hoping to land a arb
luckily, brave Jito arrived, everyone sends them bundles, and only whoever pays the most land
🌈and Solana lived happily ever after 🌈
nice story right?
1/9
"we don't see reverting Tx..
surely searchers stopped spamming & now outbid one another in the auction?
right?"
no.
here's the 3 games being played rn
/2
game 1: new coins
"bundles land first but drop on revert, so spam thru Jito and never revert"
-captain obvious
- new coins create new volatile pools
- spammers send bundles w/ tiny tips that *never revert*
- hope to get luckily
- calculate onchain - if there's arb take it
/3
we don't see reverting Tx...
because we incentivized searchers not to revert
we didn't
❌mitigate spam
❌get high % of MEV
we did
✅make Solana even more opaque!
what % of Tx / tips is this?
dude, we don't even know how much new LPs are being sandwiched..
ask again in 2029
/4
game 2: spam Jito (the oldest game)
why pay high % when you can spam jito, hoping an arb opens exactly when your bundle is simulated?
searcher tip eg 0.01 SOL, and the arb might be 0.02 or 1 SOL
best part? only pay if it lands!
so searchers buy millions of IPs to spam Jito
/5
so the auction didn't
❌"solve" incentive to spam
❌ mitigate spam
it did
✅put centralized sequencer in front of Solana
maybe that's good 🤷♂️
maybe Solana should have a trusted entity that puts Tx first👇
but it did NOT fix spam incentives
/6
game 3: the auction
Jito's auction used to be 200ms (0.2 sec), long enough for many searchers to:
- get latest state
- identify opportunity
- send bid
but it also meant 50% of the time the opportunity was captured by normal Tx 🙃
/7
So they shortened the auction from 200ms to 50ms
a Tx created arb?
searcher got average of 25ms before auction ends
only the top searchers - who see-identify-send fast - play this game
being less competitive, sometimes they bid 80-90%, sometimes 60-70%, depends on DEX
/8
the "auction mitigate spam" idea is naive
- searchers still spam
(they just don't revert)
- they spam the auctioneer
(we just introduced a trusted privileged sequencer)
- only top searchers participate in auction
(making it a lot less competitive)
Sweet dreams!
9/9
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