Background
The MEV Committee is a grants-funded initiative to help the community enforce a social mitigation strategy against malicious block proposers. The committee was assigned to actively monitor, analyze, and report any potential MEV activity, so that the community may respond appropriately to bad actors.
Monthly reports are shared with the community, offering insights into our on-chain findings, actions taken to address any issues, and improvements to our workflows. In case of malicious activity, these reports also detail the incident, the parties involved, and provide recommendations for any retroactive measures the community should consider. We welcome any feedback or questions on the report!
February and March Activity
In the months of February and March, particularly during February, we observed a decrease in orderbook discrepancies compared to previous months. The trends we previously identified in late 2024 did not appear throughout these months, indicating healthier behavior across validators. While some validators continue to show above-average empty block percentages, our analysis does not indicate any alarming trends. Similarly, our examination of per-block orderbook discrepancies over an extended timeframe reveals no significant patterns of concern.
As always, the committee has been in touch with validators, digging through configurations and setups to better understand the problems identified.
Empty Blocks
Following the healthy trend of January, the issue of empty blocks (which involves validators proposing blocks with no matched orders) has mostly normalized compared to what was identified in previous months. While some validators do occasionally propose higher rates of empty blocks, we find that over time validators now all behave in similar manners with regards to empty block proposals. This suggests the issue may relate to the network, not the performance of any individual validators. Our data can be found through our dashboard: https://dydxdashboard.streamlit.app/
High Discrepancy Blocks
In March, we identified one block with considerably above-average orderbook discrepancy that warrants analysis. Block 39814434, proposed by Hashkey Cloud on March 17th, showed orderbook discrepancies exceeding $20k in value according to Observatory’s dashboard. However, according to our node, the discrepancy was closer to $6k, indicating the presence of last-second orders that were missed by many validators, including our own node. After further analysis, we did not detect any instances of potential malicious activity. The fact that this block represents the highest discrepancy event during this period highlights the overall stability observed throughout February and March.
When examining trending averages for orderbook discrepancies across validators, we observed a few isolated spikes over particular validators and dates. However, the average discrepancy per block remains stable compared to previous months, with a few validators showing above-average orderbook discrepancy, consistent with patterns we’ve observed for these validators over recent months.
Future outlook
Following successful script testing, the committee has implemented automated processes for detecting orderbook discrepancies at the subaccount level, limiting the need for individual block analysis to particularly high discrepancy blocks as the one mentioned in this dashboard. We plan to conduct statistical analysis of these findings and will share any significant patterns with the community.
Finally, the committee will continue refining its ability to detect discrepancies, engage with validators, and develop new metrics to uncover underlying issues. Feedback and collaboration from the community are very welcome as we continue improving our research and analysis of on-chain activity.