How Does Validator Staking Size Influence Their Ability to Extract MEV?
A validator's staking size directly influences their probability of being selected as the block proposer. The larger the stake, the more frequently they are chosen.
As the block proposer, they have the temporary right to order transactions (or select a builder's block). Therefore, a larger staking size gives a validator a higher frequency of opportunity to extract MEV, either directly or by selecting the most profitable MEV-optimized block from a builder.
Glossar
Validator
Role ⎊ A validator is a critical network participant in a Proof-of-Stake blockchain responsible for proposing, verifying, and attesting to new blocks of transactions to maintain consensus and secure the distributed ledger.
Staking Size Influence
Influence ⎊ The magnitude of staking size exerts a discernible impact on various market dynamics within cryptocurrency derivatives, options trading, and broader financial derivatives ecosystems.
Liquid Staking
Stake ⎊ The core concept of liquid staking involves locking cryptocurrency assets, typically within a decentralized protocol, to participate in consensus mechanisms and earn rewards.