9. Challenges and Limitations

The first challenge of smart transactions is that they are non-trivial to solve, requiring that someone computationally and possibly interactively solve them, and then to submit their solution to the network for inclusion. This means that sophisticated execution capacity must be developed in order to facilitate smart transactions, which while presented here in the form of the solver network, this functionality can also conceivably be carried out by proposers, builders, or even smart transactors themselves. Organizing this search infrastructure to most efficiently meet the demands of smart transactions is expected to be an ongoing challenge.

A second major challenge facing smart transactions is the gas-efficiency of validation, another is the security engineering of validation. For example, a transaction might require that one of its components is included after expected adversarial transactions, however it may be prohibitively expensive to check every intermediate transaction. For another example, a transaction might want to validate counterfactual claims, but evaluating a lot of counterfactual traces might be prohibitively expensive. In the future, we can imagine transactions cheaply validating succinct zero knowledge proofs of properties that would be expensive to prove directly.

Another set of challenges is associated with transaction solutions being “stolen” from solvers by searchers, perhaps by block builders, or in coordination with validators. This might violate transaction expectations, and it will reduce the profitability of smart transactions searchers/solvers. It is fundamental that only proposers themselves can protect transactions against the risk of proposers equivocating in order replay their execution, and therefore the separation of proposers from transaction execution introduced by PBS poses a theoretical limit on the achievable security of blockchain transactions.

Thus, the problem space of MEV, even and especially, as we reframe it as a question of time, reveals the inherent political nature of the problem: who decides what time it is now, under what regime do we organize transactions, which transactions are to be considered valid, under whose time are we operating? This is the politics of block production as it changed miners to validators and now proposers with searchers working to search the best bundles, along with the politics of trusted builders.

Hence, it is vital to acknowledge that we must struggle against the ever so pressing allure that a technical solution, no matter how multifaceted and scalable, will put an end to a sociopolitical crisis. This means that we must keep building the tech stack behind the smart transaction infrastructure with never losing in sight the awareness that key to the challenge we face is one of governance. Addressing MEV will also always remain a community effort beyond the efforts of a single protocol/team. This means what we need is a multidisciplinary effort that aids in the technical innovations that smart transactions bring forth, so we can foster effective mechanisms, ways, concepts, avenues, and other such socio-political streams of research and intervention.