SoK: Current State of Ethereum's Enshrined Proposer Builder Separation

TL;DR

This paper provides a comprehensive survey of Ethereum's Proposer-Builder Separation (PBS), analyzing its current implementations, the case for enshrinement, potential upgrades, and socioeconomic impacts within the blockchain ecosystem.

Contribution

It systematically reviews existing PBS mechanisms, discusses the need for protocol enshrinement, and explores potential upgrades and on-chain socioeconomic implications.

Findings

Current PBS mechanisms vary in implementation.

Enshrinement could mitigate MEV-related issues.

Potential upgrades aim to enhance censorship resistance and fairness.

Abstract

Initially introduced to Ethereum via Flashbots' MEV-boost, Proposer-Builder Separation allows proposers to auction off blockspace to a market of transaction orderers, known as builders. PBS is currently available to validators through the aforementioned MEV-boost, but its unregulated and relay-dependent nature has much of the Ethereum community calling for its enshrinement. Providing a protocol-integrated PBS marketspace and communication channel for payload outsourcing is termed PBS enshrinement. Although ePBS potentially introduces native MEV mitigation mechanisms and reduces validator operation costs, fears of multiparty collusion and chain stagnation are all too real. In addition to mitigating these potential drawbacks, PBS research pursues many tenets revered by Web3 enthusiasts, including but not limited to, censorship resistance, validator reward equity, and deflationary finance. The subsequent SoK will identify current PBS mechanisms, the need for enshrinement, additions to the ePBS upgrade, and the existing or potential on-chain socioeconomic implications of each.