Maximal Extractable Value (MEV)
The profit that block producers can earn by reordering, inserting, or censoring transactions in a block.
What is MEV?
Maximal extractable value (MEV), formerly called miner extractable value, is the additional profit that validators, miners, or searchers can extract by controlling the order and inclusion of transactions within a block, beyond standard block rewards and gas fees. Because validators choose which transactions to include in a block and in what order, they (or specialized 'searchers' who pay higher fees) can front-run, back-run, or sandwich transactions in ways that profit from other users' trades. Common MEV strategies include front-running (placing a buy order just before a large pending buy to profit from the price impact), sandwich attacks (placing orders on both sides of a victim's trade), and arbitrage between DEXs. MEV is a fundamental feature of transparent mempools on public blockchains. It can harm ordinary DeFi users through worse execution prices. The Flashbots organization studies and attempts to democratize MEV extraction to reduce its harmful effects.
Example
A user submits a large token swap on Uniswap. A searcher bot sees the pending transaction in the mempool and submits two transactions: one to buy the token before the user's swap (pushing the price up) and one to sell it immediately after (taking profit from the elevated price the user created). The user receives fewer tokens than expected — the 'sandwich' extracts value at their expense.
Source: Ethereum Foundation — MEV