The Development and Mechanism of MEV in the Sui Network

MEV (Maximum Extractable Value) has become an important topic in the blockchain industry, involving transaction ordering and arbitrage opportunities. To ensure transparency, protect transactions, maintain network health, and reward participants, the Sui network has been implementing improvement proposals and other mechanisms to guide the development of MEV on the network.

Design Principles

The MEV ecosystem on the Sui network is formed through the following mechanisms:

1. The mechanism for submitting MEV transactions
2. Mechanism for Releasing MEV Opportunities
3. The mechanism for distributing MEV income
4. Mechanism for Protecting User Transactions

Overall priorities include:

• User trading protection takes precedence over the amount of value withdrawn.
• Network transparency is better than offline transactions with verification nodes or relays.
• Promote competition through priority gas auctions to curb inefficient behavior in the system.
• Encourage reward allocation to participants aligned with the ecosystem

Transaction Submission Mechanism

Priority gas auction ( PGA ) is an important resource allocation method on the Sui network. The key driving factor of PGA is the quantification of transaction execution:

• Transactions sorted by consensus are processed in the block.
• Traders compete for priority through gas auctions.
• The reduction in consensus submission rate diminishes the quantitative effect, but also narrows the PGA window.
• The PGA of non-congested objects is most important for the fastest seekers.
• Congestion objects may delay transaction execution, further amplifying the importance of PGA.

The Sui network has two mechanisms to direct transactions to specific upcoming submissions:

1. Submit a batch of transactions through soft bundling
2. Amplify priority transactions through consensus

These mechanisms allow for off-chain auctions for the original transaction and subsequent transactions, addressing potential jitter issues.

Choose the Appropriate Trading Gas Price

When determining the gas price for submitting a transaction, the client should consider the following factors:

1. Priority gas auction
2. Consensus Submission Amplification
3. Avoid congestion delays and cancellations

By considering these factors, the client can determine the required gas price to avoid transaction delays with a high probability.

Trading Information Release

Every transaction on the Sui network introduces potential profit opportunities. The lifecycle of a transaction begins with the client submission, goes through multiple steps, and is ultimately observed for its effects by a third party.

To achieve low-latency user transaction access, the Sui network is designing a system for directly streaming consensus blocks. This could significantly reduce the latency of transaction propagation.

User Trading Protection

User transactions need protection from front-running, sandwich attacks, and the impact of involuntary submission delays. The Sui network employs an externally member-driven transaction submission mechanism that provides natural front-running protection.

In addition, the Sui network is undertaking a project to change transaction submissions to a fast path protocol. This will improve system efficiency but may also provide verification nodes with the opportunity for pre-emptive transactions.

The Future Development of MEV on the Sui Network

The MEV ecosystem of the Sui network is still in formation, and new mechanisms will be introduced in the future. Currently, priority gas auctions and consensus amplification define the existing system, while upcoming innovations such as time-lock encryption and fast paths will reshape transaction execution and security.

With the launch of these mechanisms, MEV on the Sui network will continue to evolve, creating a more dynamic and transparent ecosystem.