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XRP adjacent Flare proposes protocol-level MEV capture and 40% inflation cut
The proposal would move block building away from individual validators, create a revenue entity called FIRE to buy and burn FLR, and reduce annual token inflation to 3%.
Updated Apr 10, 2026, 9:36 a.m. Published Apr 10, 2026, 9:04 a.m.
What to know:
- Flare proposed a governance overhaul to capture maximal extractable value (MEV) at the protocol level and redirect it from external searchers and builders to the network itself.
- The plan introduces a three-stage redesign of block building and a new Flare Income Reinvestment Entity (FIRE) to channel MEV and other protocol revenues into FLR buybacks and token burns, while cutting annual inflation to 3%.
- The proposal would sharply increase the base gas fee and boost annual token burns, even as typical transactions remain under a cent.
External estimates put annual MEV revenues at tens of millions on networks like Arbitrum, upwards of $500 million on Ethereum, and as much as $1 billion on Solana. Flare’s three-stage proposal would route the revenue into the protocol’s own token economics.
In the first stage, block building moves from individual validators to a designated builder, initially run by the Flare Entity, with a fallback to the current model if the builder is unavailable. In the second, block building moves into Flare Confidential Compute, making the process publicly auditable. The third stage merges the builder and proposer into a single entity, shifting existing validators to a verification role.
