Official statistics and reports from applications on Ethereum, Solana, or OP Stack L2 solutions

Paradigm Team Introduces MEV Taxes to Capture MEV on OP Stack L2s and L3s, Solana, and Ethereum

Jun 4, 2024, 05:24 PM

The Paradigm team, including Dan Robinson and Dave White, has introduced a new mechanism called MEV taxes. This technique allows arbitrary applications to capture their own Miner Extractable Value (MEV) while preserving composeability. The mechanism can be implemented on OP Stack Layer 2 and Layer 3 solutions such as Optimism, Base, and Blast L2. MEV taxes leverage the power of priority ordering to enable applications to capture a significant portion of MEV. For instance, an application charging searchers a $99 MEV tax for every $1 of priority fee can capture 99% of the competitive MEV for that transaction. MEV, as a percentage of DEX volume, is 0.16% on Solana and 0.087% on Ethereum. This approach is expected to drive substantial network revenues, with projections of $8 billion in Solana network revenues by 2030.