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  "id": "maximal-extractable-value",
  "canonical": "https://degreesofsatoshi.com/encyclopedia/maximal-extractable-value/",
  "collection": "defi",
  "title": "Maximal extractable value: the consequences of transaction order",
  "description": "Explore how transaction inclusion and ordering affect DeFi outcomes, including arbitrage, liquidation competition and sandwich trades.",
  "aliases": [
    "miner extractable value"
  ],
  "dates": {
    "published": "2026-10-02",
    "modified": "2026-10-02",
    "verified": "2026-10-02T15:08:18.373Z",
    "dataAsOf": null
  },
  "authorship": {
    "publisher": "Degrees of Satoshi editorial project",
    "process": "AI-assisted research and drafting with a separate automated source-verification pass; no external expert or named human review is implied."
  },
  "quickAnswer": {
    "text": "Maximal extractable value, or MEV, is value available through controlling which transactions are included, excluded or ordered in a block beyond ordinary block rewards and gas fees. Arbitrage and liquidation competition are examples; sandwiching can worsen another trader’s execution.",
    "claimId": "maximal-extractable-value-quick-answer",
    "sourceIds": [
      "mev"
    ]
  },
  "keyFacts": [
    {
      "label": "Source",
      "value": "Inclusion and ordering can change economic outcomes.",
      "sourceIds": [
        "mev"
      ],
      "id": "source",
      "claimId": "maximal-extractable-value-fact-source"
    },
    {
      "label": "Sandwich",
      "value": "A trader can be placed between two inventory-changing trades.",
      "sourceIds": [
        "mev",
        "pricing"
      ],
      "id": "sandwich",
      "claimId": "maximal-extractable-value-fact-sandwich"
    },
    {
      "label": "Liquidation",
      "value": "Eligibility creates competition to execute liquidation calls.",
      "sourceIds": [
        "pool",
        "mev"
      ],
      "id": "liquidation",
      "claimId": "maximal-extractable-value-fact-liquidation"
    }
  ],
  "prerequisites": [
    "decentralized-exchanges",
    "defi-arbitrage"
  ],
  "sections": [
    {
      "id": "ordering",
      "heading": "The same transactions can have different outcomes",
      "paragraphs": [
        "A pool’s quote depends on the state at execution. If transaction A moves the reserves before transaction B, B meets a different curve position than it would have met first. Contract validity does not remove this ordering dependence.",
        "For a concrete example, a pending swap can have a quoted output of 100 B and a minimum of 99. A preceding trade may reduce its result to 99.1. That is valid within the encoded bound even though the original quote was better."
      ],
      "sourceIds": [
        "pricing"
      ]
    },
    {
      "id": "mechanisms",
      "heading": "Arbitrage, liquidation and sandwiches differ",
      "paragraphs": [
        "Arbitrage may narrow a gap between venues. Liquidation executes the market’s collateral enforcement and can reward the caller. A sandwich instead places a trade before a user’s swap and another afterward, potentially profiting from the user’s movement along the curve.",
        "These activities have different effects on other users. Grouping all of them under MEV describes the ordering opportunity, not a judgment that every instance is the same economic behavior."
      ],
      "sourceIds": [
        "mev",
        "pool"
      ]
    },
    {
      "id": "limits",
      "heading": "Execution protection has a scope",
      "paragraphs": [
        "A meaningful minimum output restricts how far execution may worsen. It does not restore the original market state, prevent all ordering effects or guarantee inclusion. A very permissive bound leaves more room for an adverse result.",
        "Submission services and auction designs can change who sees a request and who chooses its order. Those systems have their own assumptions. A claim of complete MEV protection needs a defined threat model and cannot be inferred from a wallet’s branding."
      ],
      "sourceIds": [
        "pricing",
        "mev"
      ]
    }
  ],
  "faq": [
    {
      "question": "Did MEV disappear when Ethereum adopted proof of stake?",
      "answer": "No. The term maximal extractable value is used because inclusion and ordering opportunities are not specific to proof-of-work mining. The actors and construction process can change while the mechanism remains.",
      "sourceIds": [
        "mev"
      ]
    }
  ],
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      "statement": "Maximal extractable value, or MEV, is value available through controlling which transactions are included, excluded or ordered in a block beyond ordinary block rewards and gas fees. Arbitrage and liquidation competition are examples; sandwiching can worsen another trader’s execution.",
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      "sourceLocators": [
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          "locator": "MEV extraction; Examples of MEV"
        }
      ],
      "scope": {
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        "blockHeight": null
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      "qualification": "",
      "evidenceStatus": "documented",
      "verification": {
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        "method": "independent automated source review",
        "checkedAt": "2026-10-02T15:08:18.373Z",
        "reviewer": "automated independent verification",
        "notes": [
          "Read Ethereum’s definition, post-Merge terminology, DEX arbitrage, sandwich and liquidation examples; checked Aave liquidationCall mechanics.",
          "The QA excludes ordinary block rewards/gas fees and does not equate every ordering opportunity with the same harm or claim proof of stake eliminated MEV."
        ]
      }
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        "notes": [
          "Read Ethereum’s definition, post-Merge terminology, DEX arbitrage, sandwich and liquidation examples; checked Aave liquidationCall mechanics.",
          "The QA excludes ordinary block rewards/gas fees and does not equate every ordering opportunity with the same harm or claim proof of stake eliminated MEV."
        ]
      }
    },
    {
      "id": "maximal-extractable-value-fact-sandwich",
      "articleSlug": "maximal-extractable-value",
      "statement": "Sandwich: A trader can be placed between two inventory-changing trades.",
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          "locator": "Pricing Trades; Exact Input; Exact Output"
        }
      ],
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        "reviewer": "automated independent verification",
        "notes": [
          "Read Ethereum’s definition, post-Merge terminology, DEX arbitrage, sandwich and liquidation examples; checked Aave liquidationCall mechanics.",
          "The QA excludes ordinary block rewards/gas fees and does not equate every ordering opportunity with the same harm or claim proof of stake eliminated MEV."
        ]
      }
    },
    {
      "id": "maximal-extractable-value-fact-liquidation",
      "articleSlug": "maximal-extractable-value",
      "statement": "Liquidation: Eligibility creates competition to execute liquidation calls.",
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      "sourceLocators": [
        {
          "sourceId": "source-b35859a766315ce4",
          "locator": "supply; withdraw; borrow; repay; liquidationCall"
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        "notes": [
          "Read Ethereum’s definition, post-Merge terminology, DEX arbitrage, sandwich and liquidation examples; checked Aave liquidationCall mechanics.",
          "The QA excludes ordinary block rewards/gas fees and does not equate every ordering opportunity with the same harm or claim proof of stake eliminated MEV."
        ]
      }
    }
  ],
  "sources": [
    {
      "id": "mev",
      "label": "Maximal extractable value",
      "publisher": "ethereum.org contributors",
      "url": "https://ethereum.org/developers/docs/mev/",
      "locator": "MEV extraction; Examples of MEV",
      "note": "Transaction ordering, arbitrage, liquidation and sandwich mechanisms.",
      "version": null,
      "checkedAt": "2026-10-02",
      "recordId": "source-5bbc1a71e6d876eb",
      "contentSha256": null
    },
    {
      "id": "pricing",
      "label": "Uniswap v2 pricing",
      "publisher": "Uniswap",
      "url": "https://developers.uniswap.org/docs/protocols/v2/concepts/pricing",
      "locator": "Pricing Trades; Exact Input; Exact Output",
      "note": "Reserve-dependent quotes, trade bounds and external price observations.",
      "version": "Uniswap v2",
      "checkedAt": "2026-10-02",
      "recordId": "source-5cf943a6c62eb740",
      "contentSha256": null
    },
    {
      "id": "pool",
      "label": "Aave V3 Pool",
      "publisher": "Aave",
      "url": "https://aave.com/docs/aave-v3/smart-contracts/pool",
      "locator": "supply; withdraw; borrow; repay; liquidationCall",
      "note": "Pool operations, collateral restrictions and liquidation settlement.",
      "version": "Aave V3",
      "checkedAt": "2026-10-02",
      "recordId": "source-b35859a766315ce4",
      "contentSha256": null
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  ],
  "related": {
    "articles": [
      "slippage-and-price-impact",
      "defi-arbitrage",
      "defi-liquidations"
    ],
    "dossiers": [],
    "wallets": []
  },
  "revisionHistory": [
    {
      "date": "2026-10-02",
      "kind": "published",
      "summary": "First publication after primary-source research and independent automated verification."
    }
  ],
  "citation": "Degrees of Satoshi editorial project. “Maximal extractable value: the consequences of transaction order.” Published 2026-10-02; updated 2026-10-02. https://degreesofsatoshi.com/encyclopedia/maximal-extractable-value/"
}