Maximum extractable value MEV

What is MEV?

MEV, or Maximum Extractable Value, refers to the additional benefits that miners or validators can obtain in the blockchain by adjusting the order of transactions, including or excluding certain transactions.
Why do MEVs exist?

In a blockchain, miners or validators are responsible for packaging transactions into new blocks. Since they have the power to choose which trades are included and in which order, they can use this position to obtain additional benefits, such as through arbitrage.

The impact of MEV

MEV may cause transactions to be delayed or not included, as miners may prioritize transactions that bring them greater benefit. This can also lead to unfairness and centralization of the network.

social experiment

"p":"squ-20""op":"mint""tick": "square""amt:"1000"

About Ethereum’s Gas
Definition of Gas: Gas is a unit used in Ethereum to measure the computing resources required for transactions or contract operations.
The composition of Gas: includes Gas Price and Gas Used, where Gas Price is the amount of Ether coins that users are willing to pay for each unit of Gas, and Gas Used is the amount of Gas actually consumed by transactions or contract operations.
Calculation of transaction fees: Transaction Fee = Gas Used × Gas Price.
The role of Gas: By assigning a Gas cost to each operation, Ethereum ensures fair use of network resources and protects network security by incentivizing miners.
Network congestion and Gas: When the network is congested, users may need to pay a higher Gas Price to ensure that their transactions are processed with priority.

#以太坊 #ETH - Mempool memory pool
Ethereum’s mempool is a temporary storage area used to store all pending transactions. When you initiate a transaction, the transaction first goes into the mempool and waits for miners to add it to the next block. Miners select the transactions they mine based on transaction fees (Gas fees), and generally speaking, transactions with higher fees are prioritized. Therefore, transactions in mempool may wait for different amounts of time to be processed depending on network congestion and transaction fees.

Imagine that Ethereum is like a giant computer that can process transactions sent by many people. When you want to send a transaction (such as transferring money to a friend), the transaction is like an envelope and you put it into a giant mailbox (mempool). There may already be envelopes from many other people in this mailbox. Then, the postman (miner) will come to this mailbox, take some envelopes, and deliver them to their destination. However, the postman can only take a certain number of envelopes at a time, so if there are too many in the mailbox, your envelope will have to wait a while before it can be delivered.

Key points of mempool:
What is mempool: an area where pending transactions are stored.
Function: Help users view their transaction status and provide mineable transactions for miners.
How transactions enter mempool: When a user initiates a transaction, the transaction first enters mempool.
How transactions are mined from the mempool: Miners select the transactions they want to mine, usually based on transaction fees.
Impact of network congestion: When the network is congested, transactions in mempool may need to wait longer to be processed.

Intent-Centric is intent-centered/intent layer

As the name suggests it is easy to understand and has intention at its core.

Focus on results, not process, and at its core can be thought of as programmability.

Suppose you want to complete cross-chain transactions for LP and Staking. You need wallet, Gas, cross-chain bridge, Swap, authorization, LP, Staking, etc. The whole steps and process are long and complicated, and there are entry barriers.

The interaction of the Intent is: Tell the protocol that I want an amount of LP on the X chain and obtain more than 2% of the Staking income to ensure security and privacy. The actual processing of the protocol may give priority to the privacy chain, then select the Defi protocol that runs longer, and then operate the intermediate process, and the entire process is run in a black box.

Structure of Intent Since the entire path of Intent is different, in addition to nodes, relays, verification, etc., roles are also added.

Generally include:

Solver solver: identify the intention and program the abstract intention. This step has a high probability of being combined with AI in the future. Executor executor: execute and verify the tx from the Solver to complete the final line confirmation.

Anoma: Intent-centered general architecture/can be regarded as L1

Financing: Completed the third round at the end of May, with participation from CMCC Global and Electric Capital, with a valuation of $25 million

Previous investors include: Polychain Capital, Coinbase Ventures, P2P Capital, Figment, ZKV, Maven 11, Chorus One, Lemniscap, CMS, Wicklow Capital, Informal Systems, Interchain

At Anoma, all interactions begin with intent, where users express what they want, regardless of how to achieve it.

A provides the intent to Anoma, which processes it in the black box and returns the result using the wallet.

Since the App and intent path processing are in the black box, input and settlement can be anonymous.

The Intent general architecture provided by Anoma can be deployed on Ethereum as zkR, and can also be modularly embedded and called in various EVM frameworks.

Of course, it can also be run independently. As a separate sovereign chain, it is roughly understood as L1.5.

Anoma stack:

ZK technology: ZK-SNARK, used in MASP (can be understood as a currency mixing pool)

Consensus: Improved Typhon consensus based on Cosmos’ Tendermint

Cross-chain communication: IBC

Taiga: ZK circuit, providing a stateless execution environment,

Vamp-IR: Compiler, based on LLVM, for example, you can compile a circuit written in Vamp-IR into Plonk

Juvix: Functional Programming Language

Understand the basic block logic of the Ethereum blockchain and the profit-making role of MEV

The process of producing a single block

1. Builders receive transactions from users, searchers or other order flows and create blocks

2. The builder submits the block to the relayer

3. Relays verify the validity of the block and calculate the amount paid to the proposer

4. The relayer sends the block header and payment value to the proposer of the current slot.

5. The proposer evaluates the bid and signs the block header with the highest payment

6. The proposer sends the signed block header back to the relayer

7. The relayer publishes the block and returns it to the proposer.

Finally, block construction ends and rewards are distributed to builders and proposers in the form of transactions within the block and block rewards.

I still remember when I joined the circle, everyone was divided into the disk circle, the currency circle, the chain circle, and the mining circle. Now no one seems to mention it anymore. The big players in poker are also in pieces. Only V God is still standing. No. I know how many people still remember the big brother above.

The circles seem to be more vertical:

NFT circle, inscription circle, currency speculation circle, wool circle, Layer2 circle, Defi circle, oil refining circle, zk circle

Any more? 🤥🤥🤥

#Defi #GMX #ETH

Struct is a structured financial product on Avalanche

The current first product is Interest Rate Vaults. The core is to allow anyone to repackage any Defi asset that generates income into different parts based on risk decoupling. This process is called Tranching

Fixed Income Pool: Income generated by income-earning assets

Variable income library: The profit first meets the fixed income, and the remainder is variable income.

There is actually a leverage, that is, if the two TVLs are 1:1 and the variable library holds the fixed library, it is equivalent to an additional 2x leveraged funds.

Funds do not make strategies, they just simply hold more basic income assets

Return on the variable part = Return on underlying assets * 2 Leverage – Return on fixed income

#Manta

Privacy public chain Manta launched the privacy transaction protocol MantaPay on Calamari today.

1. Similar to Tornado and Azetc’s zkMoney, it can be used for currency mixing or private transactions

2.zkMoney has been closed recently, MantaPay can be used as an advanced product

3.MantaPay key points

🔵UTXO, almost essential for privacy

🔵Compared with zkMoney, it is faster and cheaper.

At the same time, zkMoney can only be used in one terminal. MantaPay uses a local signer and supports mnemonics, which means it can be used in other terminals. It is a truly private address.

🔵Currently supports $KMA, $KSM , $MOVR , and is expected to support stablecoins in the next step (required)

#账户抽象 #ETH

Understand the account abstraction

💙Account AbstractionAccount Abstraction

As the name suggests, it means: abstracting some functions from a system, that is, modularization

Simply understood: it supports programming to set trading conditions.

Account abstraction itself is a technical implementation direction of blockchain wallets, parallel to the direction of MPC wallets.

💙Account abstract classification

Stateless stateless account abstraction = does not rely on external state, the system and services do not save any user or client information and status, and do not rely on previous requests - conducive to achieving horizontal expansion of services, improving performance and security

Stateful = relies on external state, will save relevant information, and is affected by previous requests - conducive to realizing the richness of client functions

#MPC Study 2

MPC-based TSS

1. The core is used in the signature algorithm part, off-chain signature

2. The security guarantee of off-chain signatures is that it is impossible to confirm the rules used, and it is impossible to identify whether it is one person or multiple signatures. The signature form is fixed and there is no distinction.

3. Relies on the algorithm, so no adaptation chain is needed and the compatibility is high. Multi-sign dependency contracts

4. Signing requires a key, which is fragmented during the process, and the complete key will not appear throughout the process.

5. Key fragments are constantly refreshed

6. Assume that the key is 10. After splitting into 2 fragments, it is 5+5 in the first minute and will become 2+8 in the next minute, so unless both parts are obtained at the same time within 1 minute.

#MPCLearning

Source: https://www.odaily.news/post/5145846

Comparison between multi-signature and MPC-based threshold signature (Threshold Signature Scheme TSS) - key management level

1. Multi-signature is based on scripts/smart contracts, so the first problem arises - adaptation to different chains.

2. Smart contracts are visible on the blockchain, so anyone can find out whether there are loopholes. It takes time to verify.

3. The levels of multi-signature are roughly the top smart contract (multi-signature effect layer), the middle signature algorithm (ECDSA elliptic curve, BLS, etc.), and the bottom blockchain

#ETH

What is Delta Neutral?

1. Delta neutrality is a property

A portfolio is delta neutral if its value is not affected by small price changes in the underlying assets.

Simply put, it means that it is not affected by price fluctuations. Regardless of whether it rises or falls, the total value of the assets remains unchanged.

2.Delta hedging is a related concept and an investment strategy

The purpose is to try to keep Delta as close to 0 as possible, generally used for hedging.

For example, what we often call hedging (hedging) is a delta neutral strategy.

Delta (δ) can also be called hedging value, which can be understood as the range of changes in asset fluctuations affected by price.

#rollup

Although rollup can reduce costs, due to limitations on the number of interactions and Ethereum gas fees, the overall fee structure is still linear, which means there is actually no upper limit, but it will still be lower than Ethereum's fees.

1. For example, if rollup itself is used by many people in a short period of time, such as arb’s previous Odyssey event, it will lead to an increase in its own expenses.

2. Assuming that the gas cost of Ethereum itself remains high, the interaction cost between rollup and Ethereum will still increase to a certain extent no matter what.

Solutions include

1.celestia’s modular DA layer converts the fee structure into sub-linear, that is, there will be a final upper limit that approaches

2. Op’s Bedrock update, introducing EVM equivalence and simplifying the number of codes

#ETH #MATIC

Rollup fee issue

Mustafa's definition of Rollup: Rollup is when a blockchain publishes its blocks to another blockchain and inherits the consensus layer and DA (data availability layer) of that blockchain.

The fee structure for rollup includes

1.calldata, which is the cost of synchronizing data between rollup and Ethereum

2. Its own gas cost, the cost of packaging and sorting by the sequencer after user interaction.

In rollup, the role of the sequencer is to sequence transactions. Because in essence, rollup is to package a bunch of transactions together, and packaging naturally needs to determine the order.

#rollup To be continued

Tips for canceling Web3 wallet authorization

#ETH #BNB

For general EVM (such as Ethereum, Polygon, Avalanche, BSC) and other networks, find: MORE - Token Approvals in the official browser, then enter the address and link the wallet to cancel the relevant authorization.

Briefly understand the four basic frameworks of blockchain

Consensus layer: Transactions that occur on the blockchain are all messages, and the consensus layer defines the order of messages, that is, various consensus algorithms. The key is to ensure that the majority of nodes are honest and can process transactions accurately and quickly.

DA data availability layer: ensures that messages can be published and allows nodes to access messages.

Execution layer: The next layer of DA, interprets data, such as knowing the balance of a certain account, which can also be called translation data.

Settlement layer: confirms the correctness of execution and connects other execution layers together. Rollup is essentially the execution layer. Multiple rollups combine to form the entire settlement layer.

#zkLearning

Basic cryptography

Public key encryption/asymmetric encryption:

💧Public key encryption, private key decryption (content is encrypted and not seen by others)

A writes a letter and uses B's public key to encrypt the plain text. The cipher text is m.

B receives m, decrypts it with his own private key, and obtains the content.

💧Private key encryption, public key decryption (verify who the source is and has not been tampered with) - defend against man-in-the-middle attacks

A writes a public statement document, encrypts it with the private key, generates an encrypted document, and publishes it

B downloads the file, decrypts it with A's public key, and obtains the content.

🔵General double encryption

A uses the private key to encrypt the content and gets X - confirm that he has sent it

A encrypts X with B's public key to get X2 - the confirmation message can only be opened by B

B decrypts X2 with his own private key and gets X - sure it is sent to himself

Then use A's private key to decrypt X to obtain the content - confirm that A issued