Latest Ethereum Blocks Suggest Validators Are Reversing Censorship

Ethereum’s “censorship” issue appears to have changed over the past six months. After the US government sanctioned Tornado Cash transactions for its citizens in August, the vast majority of blocks added to the blockchain were OFAC compliant.

Now the share of “censored” blocks has shrunk to less than a third – which could be seen as a comeback for Ethereum’s anti-censorship ethos.

According to website MEV Watch, as of this past weekend and earlier this week, roughly one in three blocks made it onto the Ethereum blockchain was OFAC compliant. That means about 30% of the blocks excluded transactions sanctioned by the US Treasury Department’s Office of Foreign Assets Control (OFAC), including Tornado Cash.

Conversely, more than two-thirds of the blocks that made it onto the Ethereum blockchain in the last 24 hours are not OFAC compliant.

Since Ethereum merged in September, about 85% of the blocks that made it onto the blockchain have participated in a middleware called MEV-Boost, where validators can request pre-built blocks from builders.

MEV-Boost is software that helps validators earn MEV or Maximum Extractable Value, which are profits resulting from reordering or inclusion of certain transactions within a block. The MEV Boost software was innovated by Ethereum R&D team Flashbots to distribute MEV more evenly among validators.

Although MEV-Boost has not been integrated into Ethereum at the protocol level, it is widely adopted by the Ethereum ecosystem as 85% of validators have forwarded blocks through the middleware component. Flashbots also has its own relayer for validators to connect to, which is used by about 25% of validators.

After OFAC sanctioned Tornado Cash, there was debate as to whether or not validators should include these transactions. Since then, the Ethereum community has continued to push for a censorship reversal, and the results of these efforts now seem to be paying off, thanks in large part to the launch of new non-censoring relays.

When the sanctions went into effect, most validators were connected to Flashbots’ MEV Boost relay, which immediately programmed Flashbots to censor transactions by default.

However, in response to community backlash, Flashbots rushed to complete the process of open-sourcing his code for MEV-Boost so others could develop their own non-censoring relays.

In November, Agnostic and Ultra Sound Relays were introduced with a non-censoring version of MEV Boost. Since then, they have risen to the ranks of the relays that deliver blocks on Ethereum. Flashbots accounted for about 26% of blocks over the past 14 days, while Agnostic and Ultra Sound have each delivered about 20% of blocks over the past 14 days.

Over the weekend, Agnostic and Ultra Sound each delivered more blocks on Ethereum than Flashbots.

Martin Köppelmann, co-founder of Gnosis Chain, which runs the agnostic relay, told CoinDesk that “it took some time to get the word out and show that we offer a reliable relay.”

Now that validators have had a chance to experiment with MEV Boost, many have begun to turn to alternative relays such as Agnostic and Ultra Sound.

“The number of validators connected to us is constantly growing,” says Köppelmann. “We have been able to deliver most blocks of all seasons for some time.”