Flare on Thursday announced a governance proposal that would make it one of the first layer 1 blockchains to capture maximum extractable value (MEV) at the protocol level, rather than funneling it to a small number of specialized actors who benefit from the ordering of transactions across virtually all major chains.
MEV is the revenue that a block builder extracts by reordering, inserting, or aborting transactions within a block. In most blockchains, this value flows to external searchers and builders, effectively imposing a hidden tax on ordinary users through front-running, sandwich attacks, and arbitrage.
External estimates put MEV’s annual revenue at tens of millions of dollars for networks like Arbitrum, more than $500 million for Ethereum, and up to $1 billion for Solana. Flare’s three-stage proposal would direct proceeds to the protocol’s unique token economics.
In the first stage, block construction moves from individual validators to designated builders. It is initially executed by the flare entity and falls back to the current model if the builder is unavailable. In the second, block construction moves to Flare Confidential Compute, making the process publicly auditable. In the third stage, builders and proposers are merged into one entity, and existing validators are transitioned to the validation role.
The proposal also creates FIRE, a Flair revenue reinvestment entity that collects revenue from multiple protocol sources, including authentication fees, FAsset and smart account fees, sensitive computing fees, and captured MEV. FIRE’s primary mission is reduction. $FLR Token supply through open market buybacks and burns.
Some changes will take effect immediately upon approval. yearly $FLR Inflation will drop from 5% to 3% and the hard cap will be reduced from 5 billion to 3 billion tokens per year. A 20-fold increase in the basic gas price from Gwei 60 to Gwei 1,200 will also increase the estimated annual price $FLR At current trading volumes, it burns around 7.5 million to 300 million. Even after the price increase, a standard Flare transaction costs just a few cents.
The roots of flare are deep $XRP The ecosystem distributed the initial token supply through airdrop. $XRP The company’s FAssets system, which has generated over 150 million FXRP, is designed to bring smart contract functionality to assets on blockchains such as XRPL that do not natively support smart contract functionality.
The network reported more than $160 million in total value locked and more than 887,000 active addresses as of late March 2026.
