Unlock 10% more block rewards with MEV Maximizer feature

Having all MEV relays connected to the validator is already a widespread industry practice. Every operator utilizes it to collect more bids and extract more MEV rewards. But is it maximum?

The team at P2P.org constantly explores new opportunities and technologies to increase staking yield. We are thrilled to announce that we have made a step forward to MEV maximization, allowing our clients to extract an additional 10% more from block rewards*.

Let’s dive into how our team has been able to achieve this as one of the first staking validators in the industry.

Exploring opportunities

The validator has four seconds from the beginning of its slot to create, sign, and propagate the block to the network. By default at 0.0 sec validator requests bids from connected MEV relays, waiting some time for response, chooses the most profitable one and sign it.

But what if some builder finds a new MEV opportunity with a higher bid a little later than the start of the slot? Likely, validator will lose this opportunity.

We observe numerous examples when bids increased drastically during the first seconds of the slot. There are cases when the bid has risen from 0.05 to 300 ETH. Charts below demonstrate it.

Why do builders increase their bids over time?

Let's delve a bit deeper to understand why builders increase their bids over time. The general reasons are as follows:

• Builders strive for inclusion and need to raise their stakes to outperform competitors in a dynamic block auction occurring on relays.
• The market landscape updates more frequently than the Ethereum block time, causing the potential extracted value to fluctuate as time passes and more information/order flow becomes available.

Several examples illustrate these points:

• A new DEX swap in the mempool creates a new MEV opportunity.
• Changes in the USDC/ETH price on some centralized exchanges (CEX) just after the slot starts can lead to arbitrage opportunities on decentralized exchanges (DEX) before they disappear in the next slot.

Looking for the golden mean in delaying MEV request

Historical data shows that waiting more time before requesting MEV may increase block rewards up to 15% on average.

However we can’t delay the MEV request too much for two reasons:

1. The validator has 4 seconds to request/receive bids, sign the block, and send it to the MEV relay, leaving enough time for block propagation within the network. High delay in MEV request shifts block propagation and can lead to block misses.
2. Late blocks due to high delay will lead to an increased number of forks and reorgs since some nodes won’t receive new blocks timely.

Speaking about the second point, the plot below shows that 95% of blocks utilize bids submitted before 1.1 sec. Having that, we have about 0.1% reorgs currently. Increasing MEV requesting delay too much may increase the number of reorgs drastically.

P2P.org team has conducted enhanced experiments and infra optimisations to find a golden mean between maximizing block rewards and staying healthy for the network (not producing missed or late blocks).

This allowed us to roll out the MEV Maximizer feature for our clients, the first of its kind in the industry.

Maximizing rewards

MEV Maximizer feature allows validators to catch larger MEV rewards. Chart below demonstrates a few examples of the block rewards increase for the particular slots:

It's fair to mention that not every block shows such a significant increase in rewards, and the 10% block rewards increase was gotten for randomized sample of 4000 blocks comparing value of maximum bids change over time for discovered slots and initial bids at 0.0 slot time. A client with only a few validators due to a low number of proposed blocks may be unlucky and receive zero increase, or conversely, they may receive an extra-large MEV of 10 ETH or more.

Speaking about yield, block rewards (or execution rewards) account for 30% of total rewards, increasing APR by 10% x 30% = 3%  from 4.20% to 4.33% currently. So, if you have 250 validators, you can expect to receive an additional ±10 ETH in rewards per year, the calculations are the following 250 validators x 32 ETH x 0.13 % extra APR .

Stake with P2P.org to get early access to the newest technologies & unique perks, increasing your revenue.

Other exclusive P2P.org perks

1. Restaking with Eigen Layer. 0.5%-5pp. APR increase expected after Eigen Layer rewardslaunch in Q3 2024. Stake with Eigen Layer now to book this opportunity already available
2. Opt-in MEV relays. Configure your validator to remain regulatory-compliant or support decentralization already available
3. Stake ETH with Safe. The first-of-its-kind app on the Safe Apps Ecosystem allows users to quickly and easily direct stake ETH with just a few clicks while maintaining full custody of their assets. already available
4. Distributed validator staking powered by SSV. Don’t trust P2P.org, set up in 1 click a decentralized validator backed by the best operators: Allnodes, Stakely, Huobi and P2P.org.  coming soon

*The calculation is based solely on the methods shown above. Results calculated using other methods may differ, including on the low side. IN ANY CASE THERE ARE NO GUARANTEED EARNINGS.