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The Problem

On Ethereum—and most blockchains—transaction ordering is controlled by block proposers and builders, not by the applications themselves. In each block:

  1. A block proposer is randomly selected and has the exclusive right to propose the next block.
  2. The proposer then auctions the right to build the block to builders, who compete to produce the most valuable block.

Because MEV (e.g. CEX-DEX arbitrage, sandwich attacks) is the main driver of block value, the proposer inherently chooses the most extractive ordering—one that maximizes proposer profit at the expense of traders and liquidity providers.

Consequences for DEX Users​

CEX-DEX Arbitrage​

A traditional AMM like Uniswap V3 is a smart contract holding a balanced pool of two tokens. When you trade, you submit a transaction directly to this contract, and it executes your swap based on a mathematical formula that determines the exchange rate. The issue? These AMMs operate in a vacuum—they only update prices when someone trades against them.

This disconnect from real-world prices creates a problem. When prices change on centralized exchanges (where most price discovery happens), the AMM's price stays the same until someone trades against it.

This gap creates a profitable opportunity:

  • Arbitrageurs buy low on-chain, sell high off-chain (or vice versa).
  • Only the first arb per block can capture it for a given pool, so searchers tip builders, and by extensions proposers, to secure the arbitrage.

Result: LPs hemorrhage value, and those “tips” flow to builders instead of liquidity providers. Had LPs controlled ordering, they could recapture that loss.

Sandwich Attacks​

Swappers in typical DEXes can be sandwiched and front-run because their trades are visible in the public mempool which allows sandwich bots to detect their transaction and pay for the right to reorder them, by for example, placing their trade before and after the victim swap.

Powerless by Design​

Because ordering sits in the hands of proposers and builders, on-chain applications have no leverage to protect their users. Every swap, every liquidity deposit is funneled through the same MEV supply chain—one where the highest bidder is ultimately in control, and extractive profits come before user welfare.

  • Incentive misalignment: Those who control sequencing maximize MEV revenue, not the outcomes traders or LPs actually want.
  • Permanent disadvantage: Without a mechanism to dictate their own ordering, DEXs can never guarantee fair prices, predictable execution, or reliable fee capture.

But it doesn’t have to be this way. By reclaiming transaction ordering at the application layer—app-specific sequencing—protocols can enforce their own rules, prioritize user interests, and unlock vastly better outcomes. This is the foundational idea behind Angstrom’s architecture.

Next, see how Angstrom reclaims control by moving sequencing into the application layer → Architecture