Ethereum censorship: Flashbots organize resistance with open-source programs

Ethereum fights censorship – On September 12, the network Ethereum finalized its transition from Proof of Work to Proof of Stake via The Merge update. Unfortunately, since The Merge Ethereum is facing a major censorship issue. Flashbots, the company behind this censorship, now wants to fight against it by making its various software open-source.

Censorship on Ethereum: a tragic situation

This case is rooted in another case, that of Tornado Cash. Indeed, the Office of Foreign Assets Control (OFAC) has accused the Tornado Cash platform of having allowed the laundering of more than 7 billion dollars in cryptocurrencies.

Following his accusations, OFAC called on American companies to adopt measures to censorship of transactions related to Tornado Cash.

This censorship subsequently spread to the protocol level of Ethereum. Indeed, with the transition to Proof of Stake, the block validation process on Ethereum has undergone several changes.

Thus, a new actor called block builder has appeared. Its mission is to build blocks by selecting transactions that optimize the MEV. Unfortunately, most entities that operate block builders are located in the United States and therefore must follow OFAC’s recommendations. This is particularly the case of the company Flashbots.

As a result, more and more blocks produced on the Ethereum network adhere to OFAC’s recommendations, namely censor transactions related to Tornado Cash.

Evolution of the number of blocks applying OFAC recommendations – Source: mevwatch.

A dramatic situation for the network, which wants to be open and resistant to censorship.

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The resistance is organized

Faced with this situation, the company Flashbots did not sit idly by. In fact, last August it undertook to decentralize its service by opening the source code of its Flashbots Relay program.

Flashbots announces the opening of the code of its Relay.
Flashbots announces the opening of the code of its Relay.

A first step which was however not sufficient to solve the problem of centralization of block builders.

So, on November 18, Flashbots made a new announcement in size with opening the source code of its block builder program.

Flashbots announces the opening of the code of its Block Bluider.

In his announcement, Robert Miller the founder of Flashbots explains that competition in the field of block builders would improve resistance to censorship.

“Competition between builders maximizes rewards for validators and improves censorship resistance for users. With Suave, we envision an ecosystem of builders collaboratively building the most profitable block, with each contributing part of the block instead of one entity building the entire block. The opening of our manufacturer will accelerate this future and promote competition in today’s market. »

Indeed, the opening of the source code will allow teams around the world to operate a block builder service on Ethereum. The geographical diversity of the projects will make it possible to offer more and more block builders located outside the United States and thus reduce the share of OFAC compliant blocks.

A first step that may help to mitigate the censorship problems encountered by Ethereum.

In parallel, Vitalik Buterin, the co-founder of Ethereum, recently unveiled a new roadmap for the project. This is made up of 6 steps that aim to improve both the performance and the decentralization of the network.

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