Skip to main content

Can MEV Extraction Be Considered a Form of Regulatory Arbitrage in the Context of Derivatives Trading?

Yes, MEV extraction can be viewed as regulatory arbitrage because it exploits the lack of specific, enforceable rules governing transaction ordering on public blockchains. Traditional financial markets have strict rules against front-running.

By operating outside these jurisdictions, MEV actors profit from a structural market inefficiency that would be illegal in regulated derivatives markets.

What Is a ‘Nonce’ in the Context of a Cryptocurrency Transaction?
What Is a “Sandwich Attack” and How Does It Relate to MEV?
Are All Blockchains Susceptible to This Form of Transaction Reordering?
How Does the Shift to Proof-of-Stake Consensus Mechanisms Impact MEV Extraction?