Miner Extractable Value (MEV) refers to the additional profits block producers can earn by manipulating the inclusion and ordering of transactions within a block. This practice, known as transaction reordering attacks, typically targets Decentralized Fi- nance (DeFi) transactions. MEV incidents alone cost the Ethereum ecosystem over $350 million in 2023.
MEV opportunities are specific to the underlying blockchain infrastructure, includ- ing network topology, smart contract logic, and accounting model. While MEV in Ethereum has been well-studied in the academic literature, there has been little research on MEV in the eUTxO model.
In this work, we present the necessary background knowledge regarding MEV in the eUTxO model. We compare the account-based and eUTxO accounting models in the context of MEV. Additionally, we introduce the major Decentralized Exchange (DEX) paradigms, namely Constant Product Market Makers and Limit Order Books. Finally, we offer a game-theoretic definition of MEV and analyze three vulnerabilities within Cardano's eUTxO DeFi ecosystem.