Understanding MEV

MEV refers to the "Maximum Extractable Value", an economic phenomenon representing profit opportunities arising from on-chain transactions.

For example, a large swap on a DEX can cause token prices in a pool to fluctuate. Traders might explore the price difference in another pool to generate a positive surplus, and such arbitrage opportunities are considered MEV.

In general, arbitrage is an example of healthy MEV, as finding better quotes is vital in a free market and benefits the end user.

On the other hand, toxic MEV can be pretty harmful. For example, when users trade with high slippage and/or are unaware of sandwich attacks or when the Solana network is congested due to heavy sniping.

Urani's Approach

Urani addresses Solana's MEV minimization issue at the application layer by:

I. Moving the orderflow auction process off-chain with peer-to-peer (P2P) and ring matches, eliminating intrinsic swap fees and slippage.

II. Offering multiple incentives for operators to contribute positively to the ecosystem, transforming toxic MEV into free market opportunities.

Additionally, we coined the term "MEV agents" to distinguish "healthy" bots from toxic MEV bots. We refer to the humans behind these bots as "MEV agent operators." At Urani, they are as important as any other actor in the supply chain.

Learn more about MEV

➡️ To learn more about how Urani protects users against toxic MEV, check out our docs.
➡️ To visualize real-time sandwich attacks on Solana, check out sandwiched.me.
➡️ To explore MEV and fee markets on Solana, check out our curated library.
➡️ To delve deeper into MEV in general, explore Go Outside's toolkit