Title: Unveiling the Big Business of MEV on Solana
Author: Maggie (X: @0xmaggie5)
Over the past year, the Memecoin craze has turned Solana into a gold rush for traders. Countless people chase the volatile meme coins, attempting to gain an edge with trading bots. However, few realize that the truly guaranteed lucrative business is not dancing on the K-line chart, but hidden deep in the blockchain's dark forest. This is MEV (Maximum Extractable Value). Compared to publicly visible bot earnings, MEV profits are often hidden in block construction and ordering mechanisms, controlled by the "invisible hand" that holds chain power and infrastructure.
Many are unaware because this system has high entry barriers, extremely asymmetric information, and highly concentrated controllers. While you use bots to front-run and prevent sandwich attacks, MEV hunters control transaction ordering behind the scenes, precisely capturing arbitrage opportunities. When retail investors compete in speed and strategy, large institutions with staking advantages and node permissions already sit at the top of the profit pyramid. On Solana, MEV is not just a trading opportunity, but an infrastructure-level power—controlled by a few, forming a high-barrier, highly monopolistic, and highly profitable capital game.
Today, we'll unveil the big business of MEV on Solana.
1. First, What is MEV?
MEV, or Miner Extractable Value, refers to miners' ability to include, omit, and order transactions when packaging blocks to earn maximum additional revenue. Due to the Memecoin craze and DeFi activity, MEV's scale is massive. From a business perspective, MEV typically includes liquidation, arbitrage, and sandwich attacks.
Liquidation: Liquidating positions near default to earn rewards. When borrowers fail to maintain the collateralization ratio required in lending protocols, their positions become eligible for liquidation. MEV searchers monitor these under-collateralized positions on the blockchain and execute liquidation by repaying part or all of the debt in exchange for a portion of the collateral as a reward.
Arbitrage: Buying and selling simultaneously on different DEXs to profit from price differences. The simplest arbitrage occurs when two DEXs have different prices for the same trading pair, allowing arbitrageurs to profit from the price gap.
Sandwich Attack: Buying before and selling after a target transaction for profit. In DeFi markets, attackers use three atomic bundled transactions: first, a non-profitable front-running trade that raises asset prices to the victim's maximum slippage tolerance, then the victim's trade is executed at a high price, further pushing up the price, and finally, the attacker sells the asset at an inflated price through a post-trade transaction, offsetting initial costs and generating net profit.
Behaviorally, it's typically distinguished as front-running and back-running
Front-running: MEV searchers identify another trader's buy or sell order in the mempool and place the same order before that trader, profiting from the price impact.
Back-running: The counterpart to front-running, this MEV strategy exploits temporary price imbalances caused by poorly routed transactions. Once a user's transaction is executed, reverse transaction searchers balance pool prices by trading the same asset and ensure profit.
Liquidations are always back-running, most arbitrages are back-running, and sandwich attacks are front-running + back-running. For specific MEV cases, refer to Helius's report, which provides detailed explanations and examples.
[The translation continues in the same manner for the rest of the text.]To further expand its node staking volume, Jito launched a staking protocol that allows ordinary users to delegate SOL to Jito nodes and proportionally share block rewards and MEV earnings. Stakers earn income, nodes improve block production probability, and traders get priority execution opportunities, forming a complete MEV interest closed loop with three key characteristics: information advantage, monopoly effect, and capital barriers.
MEV is an information war, where winners take all in competing for MEV opportunities on Solana, battling at millisecond-level speed and on-chain information sensitivity. Whoever can discover arbitrage opportunities fastest and accurately place transactions in the same/next Slot will capture the earnings.
This depends on two points: rapid information synchronization capability, typically requiring connection to large Jito node RPC services; fast transaction on-chain submission, prioritizing transactions through Jito Bundles channel and paying sufficient Tips. Jito's bundle service is monopolistic. The key to MEV lies in "who is the block producer (Leader)". For Jito to provide stable and reliable bundling services to traders, it must cover as many Leader Slots as possible. This requires its client to have extremely high network coverage to ensure most rounds are Jito node block productions.
Once reaching a critical point, network effects self-enhance: the more widespread the adoption, the more stable the service, and the harder for competitors to shake. This explains why Jito quickly consolidated 94% of client market share. Solana's MEV is a capital game - as a PoS chain, the more staking, the higher the probability of becoming a Leader. And the Leader, having block ordering rights, naturally obtains the most MEV and Tips.
This brings a highly concentrated capital barrier: large nodes with more staking have higher block frequency and faster information synchronization; more sensitive information means stronger arbitrage capabilities; large nodes' RPC services (even in the same data center) prices rise, becoming scarce information entry points.
Those who can earn MEV often can only do so through the most capitalized large nodes.
4. MEV Revenue Flow on Solana: Who Earned the Money?
As mentioned earlier, MEV earnings on Solana are substantial. So who ultimately receives these earnings? They primarily belong to three core interest parties: the Jito protocol itself, large high-staking nodes, and block space sales brokers.
Jito Protocol: Infrastructure tax collector. In the past year, Jito processed over 4.3 billion transaction bundles, generating total user-paid Tips of 5.51 million SOL. Calculated at SOL price of $140, this means on-chain additional transaction value guided by Jito infrastructure is approximately $7.7 billion. Jito and validators share 3-5% platform revenue, so Jito's actual earnings in the past year were about 20-27K SOL, approximately $3.5 million.
High-Staking Nodes: On-chain privileged class. As Solana is a PoS chain, nodes with higher staking amounts have higher block production probability. These "top validators" not only continuously obtain basic block rewards and inflation income but also acquire massive transaction Tips from Jito Bundles. Normal node income is about 6%, and during high network activity, some nodes' annualized returns can reach over 20%, far exceeding ordinary nodes. Their income sources include: inflation rewards, block rewards, Jito Tips, and some earnings from selling SWQoS transaction on-chain permissions.
Block Space Sales Brokers: Transaction on-chain intermediaries. These brokers play the role of block space secondary sellers. Their operating logic is: establishing cooperation with high-staking nodes to purchase SWQoS transaction on-chain permissions at preferential market prices; (Stake-Weighted Quality of Service SWQoS allows leaders to identify and prioritize transactions from staked validators) packaging multiple user transactions into Jito Bundles, centrally increasing Tips to obtain higher priority; users' paid Tips far exceed what brokers pay validators, allowing brokers to profit from the difference; simultaneously, they embed their own arbitrage transactions in Bundles (like Backrun) to further obtain MEV earnings.
Overall, Solana has experienced highly centralized rights, with Jito's MEV earnings predominantly captured by the Jito protocol, large validator nodes, and block space sales brokers.
6. How Do Large Institutions Gradually Become Profit Manipulators on Solana?
Solana's architecture naturally tends towards centralization, providing favorable soil for large institutions to intervene and dominate the ecosystem. Solana Foundation, Jito, Multicoin, Jump, Helius, Coinbase, Binance, Jupiter and others have significant governance rights on Solana. Many institutions are optimistic about Solana's future prospects and hope to become one of its profit manipulators. Taking the recently active Sol Strategies as an example, we can clearly see how large institutions gradually infiltrate and become Solana's profit manipulators:
Step One: Sol Strategies expands market share and ecosystem dominance by acquiring nodes, becoming one of the main players. Currently, Solana's staking rate is as high as 65.6% (approximately 380 million SOL staked), and controlling validator nodes means mastering the network's consensus mechanism and voting rights. Sol Strategies rapidly acquired top nodes, quickly cutting into the power core:
November 2024: Acquired Cogent Crypto, a validator node operator for Solana, Sui, Monad, and ARCH networks, for $18 million (cash + stock), focusing on the SOL network. March 2025: Acquired top Solana validators Laine and Stakewiz.com for 35 million Canadian dollars (cash + equity), increasing SOL staking to 3.3 million tokens (worth approximately $388 million), and recruited Laine's founder Michael Hubbard as Chief Strategy Officer.
Step Two: Attempting to promote the inflation rate adjustment proposal SIMD-228 to further consolidate power. (The proposal ultimately did not pass) Sol Strategies strongly pushed the SIMD-228 proposal to adjust the inflation mechanism, aiming to introduce a dynamic inflation mechanism to replace the current fixed deflationary model. If the proposal had passed, Solana's annual inflation rate would have dropped from a fixed 4.68% to 1% or even 0%. Although the proposal was ultimately not approved, its strategic intent was very clear:
Stabilize SOL value: Reducing inflation can decrease new SOL releases, alleviate token selling pressure, and enhance long-term staking returns; Suppress small nodes and consolidate large node dominance: Lower inflation would compress all validators' earnings, but small nodes have weaker risk resistance and are more likely to be eliminated, which would help push the network towards centralization among top validators.
Step Three: Profit manipulation on Solana. Advancing Solana ETF listing, institutionalizing crypto assets, and becoming an ETF staking provider. Sol Strategies became a staking provider for the 3iQ Solana Staking ETF and pushed for its listing, attempting to further expand staking volume and compete for blockchain governance leadership.
Summary:
MEV is a big business. MEV on Solana is particularly intense and profitable. Protocols like Jito are monopolistic with strong head effects. On Solana, rights are highly centralized, with MEV profits mainly captured by the Jito protocol, high-staking nodes, and block space sales brokers. Currently, there are multiple clients on the Solana network, with the Jito-Solana client dominating the mainnet, and the Firedancer client supporting Jito protocol potentially becoming a high-performance future upgrade. Solana is very suitable for institutional dominance. Through node acquisitions, attempting to push governance proposals, and promoting ETF listings, SOL Strategies demonstrates how an institution can comprehensively infiltrate Solana across technical, governance, and financial systems to compete for blockchain governance sovereignty.
