What Is the Risk of a ‘Miner Extractable Value’ (MEV) Attack Related to Liquidations?

MEV risk arises when liquidators pay higher gas fees to miners to ensure their liquidation transaction is processed first, guaranteeing them the liquidation bonus. This can lead to an inefficient liquidation process, where the best liquidator (who might be slower) is blocked.

It also causes a 'gas war' that drives up transaction costs for all users and can be exploited by malicious actors.