May I recap the problem and ask about a similar approach? It sounds like this MEV is coming from cases where it is beneficial to trade faster/first, e.g. arbitrage situations or high frequency trading type scenarios. The traders are willing to pay a lot to be first, and the miners can extract some of that. The trader who wins the race gets a lot of profit, but they are not really viewed as providing much value to society over the person who loses the race. So there is a fairness question of who should get to capture the value. Miners seems unfair, letting the trader keep it isn’t necessarily desirable.
Your proposal allows the automated market makers to capture some of the value. My understanding is that all the McAMMs would have to coordinate to be part of the proposal? I’m wondering about more decentralized solutions the AMMs can implement themselves.
Specifically, the AMM could have a slower “tick” time. If multiple trades all arrive within one tick, they are batched and executed together in a way that treats them all equally. Concretely, if a ton of orders all arrive to buy A during the same minute, none of those orders will get the original great price for A.
Different AMMs do compete with each other, but that might be okay – the slower traders would rather send their business to one of these slow-tick AMMs rather than the one that rewards the fastest trader, so they should be able to compete.
How does this compare to your suggestion of a mechanism at the block builder level? Thanks.