Does Timeboost Reduce MEV-Related Spam? Theory and Evidence from Layer-2 Transactions

Abstract: Maximal extractable value opportunities often induce spam in Layer-2 blockchains: many identical transactions are submitted near simultaneously, most of which revert, wasting blockspace. We study Timeboost, a mechanism on Arbitrum that auctions a timestamp advantage, crucial under first-come first-served sequencing rules. We develop a game-theoretic model in which users choose the number of transaction copies to submit, and extend upon the baseline setting by modeling the Timeboost auction and subsequent transaction submission behavior. We show that Timeboost reduces spam and increases sequencer/DAO revenue in equilibrium relative to the baseline, transferring user payments from revert costs to auction bids. Empirically, we assemble mempool data from multiple Layer-2 networks, measuring spam via identical transactions submitted in narrow time intervals, and conduct an event study around Timeboost adoption on Arbitrum using other L2s as contemporaneous benchmarks. We find a decline in MEV-related spam and an increase in revenue on Arbitrum post-adoption, consistent with model predictions.