According to Odaily Planet Daily, the European Securities and Markets Authority (ESMA) has labeled the maximum extractable value (MEV) as a potential form of market abuse, a position that has worried some industry observers who say the situation is unclear. In a regulatory proposal released last week under the Digital Assets Act (MiCA), ESMA said that MEV may be suspicious. The definition of MEV is broad, but it generally includes trading strategies in which blockchain operators (companies and individuals who add blocks to the chain) preview the network transaction queue to extract additional profits for themselves.
“MEV itself should not be considered market abuse at all and should not have negative connotations,” Anja Blaj, a policy expert at the European Cryptocurrency Initiative (EUCI), said in a WhatsApp interview. “The scenarios and strategies that have similar effects to market abuse are very limited. This should be repeatedly emphasized because the purpose of MEV is first and foremost to compensate good actors for the validation work they do.”