MetaMask, the leading Ethereum wallet, is launching a new feature called Smart Transactions to combat the negative effects of maximal extractable value (MEV).
MetaMask, the leading Ethereum wallet, is launching a new feature called Smart Transactions to combat the negative effects of maximal extractable value (MEV). The optional feature allows users to submit transactions to a "virtual mempool" before they are officially included on the blockchain. Developed by Consensys, the company behind MetaMask, the virtual mempool aims to protect against certain MEV strategies and simulate transactions behind the scenes to help users secure lower fees.
MEV refers to the additional profits that blockchain operators can extract from users by manipulating or prioritizing transactions before they are recorded on the network. This practice has been compared to front-running orders in traditional financial markets. MEV drives up prices for users, slows down transaction speeds, and can even lead to transaction failures under specific network conditions.
Consensys' Jason Linehan, director of the Special Mechanisms Group, highlighted the urgency of the issue, stating that approximately $400 million is wasted annually due to transaction rollbacks, stuck transactions, and predatory MEV practices. Linehan emphasized the unanimous agreement within the industry that MEV is a major problem, calling it nonsensical for users to pay for transactions that yield no results.
MetaMask's solution, the virtual mempool, bears similarities to private mempools, which are employed to enhance transaction privacy and protect against MEV. However, Consensys asserts that its virtual mempool is distinct and necessary to address the hidden costs of Ethereum. While private mempool services have raised concerns about centralization, Consensys assures that their virtual mempool is different and does not seek to take over Ethereum. Instead, it aims to eliminate the wasteful expenditure of $400 million each year, recognizing that such inefficiency impedes Ethereum's potential to become the foundation of the global economy.
This article contains links to third-party websites or other content for information purposes only (“Third-Party Sites”). The Third-Party Sites are not under the control of CoinMarketCap, and CoinMarketCap is not responsible for the content of any Third-Party Site, including without limitation any link contained in a Third-Party Site, or any changes or updates to a Third-Party Site. CoinMarketCap is providing these links to you only as a convenience, and the inclusion of any link does not imply endorsement, approval or recommendation by CoinMarketCap of the site or any association with its operators.
This article is intended to be used and must be used for informational purposes only. It is important to do your own research and analysis before making any material decisions related to any of the products or services described. This article is not intended as, and shall not be construed as, financial advice.
The views and opinions expressed in this article are the author’s [company’s] own and do not necessarily reflect those of CoinMarketCap.
