What does MEV do for Defi's liquidity mining on Ethereum?

Asked 20 days ago

Hi, I've been told that the Maximal Extractable Value has a big impact on Ethereum mining and that it may improve the liquidity pool overall. I'm not so sure for DeFi users, though. Apparently, the MEV watches for unconfirmed transactions and then slips in their own transaction that pays a higher fee. Ultimately discontinuing that user's opportunity for a transaction, not so?

Filip Dimkovski

Filip Dimkovski

Thursday, September 22, 2022

MEV (also known as Maximal Extractable Value) allows miners to maximize their profit by prioritizing transactions properly. For example, if the miner can choose between 3 transactions, MEV allows it to prioritize the most profitable one.

However, since Ethereum switched to PoS (proof-of-stake) on September 15th, miners can no longer use MEV for the transactions. Now, they might consider using it on Ethereum's forked version (ETHW), which is a PoW protocol that branched away from Ethereum.

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