📚 New Mempool Design to Prevent Order Manipulation in Blocks ✅ Summary This proposal introduces an encrypted Ethereum mempool (where pending transactions are stored), making the contents invisible until they are included in a block. This aims to significantly reduce behaviors such as front-running (intercepting others' transactions) and MEV (Miner/Validator Extractable Value) strategies that manipulate transaction order or prices for profit. While transactions are eventually revealed, the key point is that their contents remain hidden until just before execution. ✅ Why an Encrypted Mempool is Needed Currently, in Ethereum, anyone can view the contents of transactions in the mempool. This allows MEV strategies like front-running and sandwich attacks (inserting transactions before and after others to manipulate prices), which can lead to user losses and centralization of block builders (concentration of power among a few strong entities). By encrypting transactions, the order remains visible, but the contents become hidden, making such attacks much harder to execute. ✅ How Transactions are Encrypted Each transaction is divided into an "envelope" and an "encrypted payload." The envelope contains minimal plaintext information such as gas amount, fees, and which key provider is used for decryption. The payload, which includes the actual recipient, amount, and contract call data, is encrypted. Only after the transaction is included in a block and the corresponding decryption key is published can the contents be executed. ✅ The Role of "Key Providers" Key providers are entities that manage the decryption keys. The design allows for various methods to be used, not limited to a single approach: - Threshold cryptography (distributed key management among multiple parties) - MPC (Multi-Party Computation, where secrets are shared among multiple parties) - TEE (Trusted Execution Environment, secure hardware areas) - Time-delayed cryptography Ethereum itself only provides the foundational infrastructure that supports any of these cryptographic methods. ✅ Transaction Order and Safety in Blocks In a block, plain text transactions are executed first, followed by the processing of encrypted transaction envelopes, and finally the execution of the decrypted payloads. This structure ensures the following safety: - Fees are always paid first - The payload is not executed unless the key is released Even if the key is not released, the processing of the envelope alone stops the transaction, without halting the entire chain. ✅ Impact on MEV and Censorship Resistance When the contents are hidden, block builders cannot calculate in advance which transactions will affect which prices. This makes it difficult to profit from order manipulation, structurally weakening MEV. Additionally, since the contents are hidden, it becomes harder to selectively exclude specific addresses or DeFi operations, improving "real-time censorship resistance" (the property of not being blocked immediately).