Researchers Develop Threshold Encryption Design to Mitigate MEV Attacks

Flash Freezing Flash Boys (F3B), a newly proposed threshold encryption design, aims to mitigate malicious MEV attacks on blockchain networks. The protocol addresses limitations in early systems by applying per-transaction encryption, ensuring that each transaction remains confidential until it reaches finality.

The general flow of the F3B protocol involves encrypting transactions with a key accessible only by the designated threshold committee, storing and ordering them while retaining decryption metadata, and releasing shares for prompt post-finality reconstruction and execution. The protocol has shown minimal performance overhead on simulated proof-of-stake Ethereum, incurring delays of 197 ms for TDH2 and 205 ms for PVSS.

F3B incentivizes honest behavior among Secret Management Committee trustees through a staking mechanism with locked collateral and fees to motivate them to stay online. However, the protocol still relies on the assumption that the majority of committee members behave honestly, as it does not prevent trustees from colluding privately off-chain to reconstruct and decrypt transaction data.