# centralized L2 sequencers convert MEV from public bot competition to hidden private extraction All major Ethereum L2 rollups (Arbitrum, Optimism, Base, ZKsync, Unichain) rely on centralized sequencers that control transaction ordering. These sequencers operate private mempools with block times between 0.2s and 2s — fast enough that traditional same-chain sandwich attacks were not identified on any analyzed rollup in a January-July 2025 study. The sequencer's ordering speed creates a different MEV environment than Ethereum mainnet, not a MEV-free environment. The transformation is from competitive public extraction to private unilateral extraction. On Ethereum mainnet, MEV bots compete openly in the mempool — this competition is observable, measurable, and partially self-limiting. On L2s, the sequencer can privately extract MEV from its transaction ordering without any competing bot visibility. This extraction is structurally invisible: there is no public auction to observe, no failed transaction trail, and no competing bidder revealing the opportunity's value. Since [[L2 sequencer centralization creates systemic liveness censorship and regulatory risks]], sequencer control already creates multiple risk vectors. MEV adds a financial extraction dimension to the existing censorship and liveness risks. Reverted transactions on rollups are not accidental — they are equilibrium outcomes of rational MEV strategies. Critically, reverted transactions contribute disproportionately more to sequencer fee revenues than gas consumption, shifting economic welfare from users to sequencers. Mitigation approaches being developed: shared decentralized sequencers (Espresso, Radius) aggregate transactions from multiple rollups before sequencing, limiting any single sequencer's ordering control. TEE-attested sequencers use Trusted Execution Environments to ensure ordering fairness without revealing the actual ordering algorithm. Based rollups delegate sequencing to Ethereum validators, inheriting L1 decentralization at the cost of L1 block time constraints. Delay encryption (used by Radius) directly addresses the information asymmetry: sequencers receive encrypted transactions and must commit to an ordering before decryption — preventing ordering decisions based on transaction content. --- Relevant Notes: - [[L2 sequencer centralization creates systemic liveness censorship and regulatory risks]] — the broader context of which hidden MEV extraction is one financial dimension - [[sandwich attacks exploit AMM deterministic pricing to front-run and back-run victim trades within a single block]] — same-chain sandwich attacks that are notably absent on rollups due to sequencer ordering speed - [[encrypted mempools with random transaction permutation reduce sandwich attack revenue by over 99 percent]] — delay encryption used by Radius is directly applicable as an L2 sequencer MEV mitigation Topics: - [[vulnerability-patterns]] - [[protocol-mechanics]]