- searchers who have access to private and public mempools can aggregate txs and predict price movement.
- market makers (lps) can use order flows to model information from incoming orders and readjust prices and spreads.
- traders can use order flow sas a short-term strategy to time their trade.
- this type of private order flows can be realized by modifying either the user's rpc or by modifying the protocol's frontend
- the rpc endpoint re-broadcasts (forwarding) the tx to nodes.
- in respect to every pending tx they receive, they can: 1) censor, 2) forward to some mempool, or 3) forward it directly to some block-builders or validators.
- private tx reordering
- two goals: 1) identify valuable user txs, 2) replace the POFP's value-extracted tx with its own value-extractive tx
- when a VTRP is able to identify a valuable user tx but, due to the tactics of the POFP, is unable to inject its own transaction in place of the POFP's -> VTRP's optimal strategy is to censor the user's transaction from the final block
- the orderflow auction design space, by frontier (2023)
- private order flow and the block builder market, by j. charbonneau (2022)
- ethereum's biggest issue no one's talking about, by mvd wijden (2022)
- private order flow is the new mev (video), by empire (2022)
- order flow, auctions and centralisation II: order flow auctions, by quintus (2022)
- order flow auctions & enshrined builder, by apriori (2022)