EDIT: looks like this is expected behavior due to nonces, see posts below.
I am writing to share a concerning finding with you, which is that I have seen a block where transactions were mined out of order with regards to gas price. I do not intend to make any conclusions in this post; I would just like to present the information.
As you will see, this type of behavior is concerning because of the potential for MEV extraction by validators. Bor is currently programmed to order transactions first by gas price, and then by “time seen”. Validators already a vast advantage over non-validators when it comes to MEV, as they are peered with all other validators and thus, have extremely low latency to whomever is the current block producer. (Detailed in this thread regarding BSC, but still applicable to Polygon: https://github.com/binance-chain/bsc/issues/269)
However, if the validators start ordering transactions in a non-default manner, they can effectively capture all of the MEV that is created on the Polygon network.
The information is as follows.
(I apologize for the lack of links in this post; I was limited by the forum rules for new users. Please copy/paste into Polygonscan as needed.)
This is the block:
The out of order transaction:
Why is the transaction out of order?
The transaction immediately before and after this one uses exactly
This transaction uses
Now, what is this transaction?
This transaction itself didn’t do anything. It is important to note, however, that the transaction appears immediately after an oracle update to Aave’s USDC oracle: 0x7b340f63074f94d0088186f85884c4687451d3813db24495d9ee0c09c43e569a
Why is this oracle important? Because it can trigger an Aave account’s health factor to go below
1, which means that the user can now be liquidated.
Who is the recipient of this transaction?
The recipient of the out of order transaction is a smart contract: 0xb4171e36cbeea21a8b5a2dab5f9ed9f5dc7ecfe4
What does this smart contract do? Aave Liquidations. In the 17 days that this contract has been active, they have made approximately
$767,901.36 from liquidation bonuses, before accounting for trading fees (as they are using flashloans as the upfront capital to perform liquidations.) I calculated this figure using Aave’s subgraph, however you can just go to the “ERC-20 Token Txns” tab on Polygonscan to easily verify that they are receiving large amounts of liquidation bonuses.
Here is an example of a successful transaction: