Reliable detection of private order flow leakage across Ethereum builders

Develop a reliable mechanism to detect private order flow leakage across Ethereum block builders within the MEV-Boost Proposer-Builder Separation ecosystem by ascertaining when a builder that receives private orders leaks those orders to another builder (including Sybil identities), so that such leakage cannot bypass reputation or economic penalties and can be provably identified for enforcement.

Background

Private order flows—transactions that bypass the public mempool—are a key entry barrier for new builders and a central factor in MEV-Boost auctions. Today, providers rely on informal reputation requirements (e.g., minimum market share) to protect against abusive behavior by builders, because builders can potentially unbundle or leak private bundles without reliable detection or accountability.

This trust asymmetry contributes to centralization: providers share flows only with reputed builders, and builders can create Sybil identities to evade penalties. The authors highlight the need for mechanisms to detect leakage reliably. They discuss watermarking as a potential approach (watermarks that are invisible and do not affect execution) and suggest that such detection would enable reputation or collateral-based enforcement against leakage.