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Vitalik Buterin unveils plan to curb block builder centralization

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Vitalik Buterin to spend $43 million on Ethereum development

Vitalik Buterin is turning his attention to a part of Ethereum most users never think about but that has quietly become one of its biggest pressure points: who gets to decide what transactions goes into a block.

In a new blog post on Monday, the Ethereum co-founder lays out a series of ideas aimed at preventing block building, the process of assembling transactions before they’re finalized onchain, from becoming too centralized.

While Ethereum’s upcoming “Glamsterdam” upgrade will formalize proposer-builder separation, which will allow validators to outsource block construction to a competitive market, Buterin argues that simply creating a marketplace of builders doesn’t solve everything. If a small number of builders dominate, they could still censor transactions or extract outsized profits from users.

One proposal, known as FOCIL, would act as a kind of anti-censorship backstop. Under the design, a small group of randomly selected participants would each choose transactions that must be included in the next block. If those transactions are missing, the block would be rejected. The idea is that even if a single hostile builder controlled the entire market, they couldn’t permanently exclude specific users.

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Another focus of his post is so-called “toxic MEV,” where traders exploit visibility into pending transactions to front-run or “sandwich” users’ trades. One potential fix is encrypting transactions until they are finalized, preventing opportunistic actors from seeing them in advance.

Buterin also points to risks at the networking layer, where transactions can be observed by intermediaries before they even reach a block, suggesting that anonymized routing systems could become an important line of defense.

Longer term, he sketches out a vision of more distributed block building, where not every transaction requires full global coordination. Much of Ethereum’s activity, he argues, may not need to be processed in a single, tightly ordered bundle, opening the door to designs that reduce central chokepoints.

Overall Buterin seems to focus on as Ethereum scales, decentralization challenges are shifting from validators to the infrastructure that decides what users’ transactions actually make it onchain.

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Read more: Vitalik Buterin reveals his bold new plan to fix Ethereum’s scaling problem

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Crypto World

Balancer Labs Shuts Down, Protocol to Continue

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Balancer Labs Shuts Down, Protocol to Continue

Balancer Labs, the team behind the decentralized finance protocol Balancer, is shutting down after mounting financial pressure and a $116 million hack in November, with executives proposing continuation of the protocol under a leaner, more cost-effective structure.

“After careful consideration, I have decided to wind down Balancer Labs. This is not a decision I take lightly,” one of Balancer Protocol’s founders, Fernando Martinelli, said on Monday, adding that Balancer Labs has become a “liability rather than an asset to the protocol,” as it has been operating without revenue.

Balancer Labs CEO Marcus Hardt added that it was spending too much to attract liquidity relative to the revenue the protocol is making, a strategy that came at the cost of diluting Balancer (BAL) token holders.

Source: Marcus Hardt

Balancer was one of the more notable DeFi protocols during the 2020–2021 bull market, reaching a peak of $3.3 billion in total value locked (TVL) in November 2021.

However, that figure fell to $800 million by October 2025, with the hack leading to another $500 million TVL drop over the next two weeks. Balancer’s TVL has since fallen to $158 million, showing how challenging it is for DeFi protocols to recover from large-scale hacks.

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Martinelli said the November exploit “created real and ongoing legal exposure” and that maintaining a corporate entity that carries the liability of past security incidents wasn’t sustainable.

Balancer Labs executives outline restructuring plan

Moving forward, Hardt and Martinelli are pushing for Balancer’s future to be managed by the Balancer Foundation and the protocol’s decentralized autonomous organization.

Martinelli advocated for Balancer to adopt a more “lean continuation path,” which involves cutting BAL emissions to zero, restructuring fees to enable Balancer’s DAO to capture more revenue, reducing the team as much as possible and targeting lower operating costs.