Analyzing the "Trinity" behind Unichain: Uniswap, Flashbots, and OP-Stack

Author: Crypto Researcher 100y

Unichain is an Ethereum optimistic Rollup solution based on the OP Stack architecture, jointly launched by Uniswap, Flashbots, OP Labs, and Paradigm, aimed at addressing a series of issues present in current DeFi applications.

Unichain provides effective solutions through the following two core advantages:

1) Verifiable block construction and

2) Unichain verification network.

The main advantages offered by Unichain include:

1) Fast state updates: Reducing block generation and confirmation delays, enhancing user trading experience;

2) Support for internalized MEV extraction in applications: Utilizing Trusted Execution Environment (TEE) technology, applications can capture MEV profits more directly;

3) Efficient settlement through rapid economic finality: Quickly achieving transaction finality, thereby reducing user wait times and enhancing liquidity.

Verifiable block construction is achieved through the Rollup-Boost developed in collaboration with Flashbots. Rollup-Boost provides two core functions: Flashblocks and verifiable priority ordering. Its design is similar to MEV-Boost, serving as an additional block construction tool to assist the operation of the main blockchain. Flashblocks are pre-confirmed blocks generated by TEE builders. Unichain splits a complete block into four parts by generating partial blocks, with each part being generated and sent to the sorter every 250 milliseconds.

The sorter continuously receives these partial blocks and simultaneously executes the transactions within them, providing users with early transaction execution confirmations. These partial blocks are guaranteed to be included in the complete block ultimately proposed by the sorter. In this way, Unichain can quickly update states, reduce transaction delays, enhance user experience, and mitigate the negative impacts of malicious MEV to some extent.

Priority ordering is a block construction mechanism proposed by Paradigm's Dan Robinson and Dave White. This mechanism assumes that block proposers arrange the transaction order solely based on the priority fees of transactions, without reviewing or delaying the processing of transactions. This model is only feasible in a single or trusted block proposer environment, while it is difficult to implement in competitive block construction environments like Ethereum L1 with multiple proposers. The main purpose of priority ordering is to allow dApps on the mainnet to levy MEV taxes on transactions interacting with them, thereby enabling them to extract a portion of MEV profits. These profits can be used internally by the dApp or redistributed to users.

The key is to ensure that the entities responsible for block construction utilize the priority ordering mechanism. To achieve this, Unichain has taken two measures:

1) Separating the sorter and block builder (similar to the PBS model);

2) Mandating that block builders use TEE (Trusted Execution Environment), allowing anyone to verify whether they are using the priority ordering mechanism.

In the block construction process of Unichain, all operations are conducted within the TEE environment. Utilizing the characteristics of TEE, these builders can submit certifications to users, proving that they are using the priority ordering mechanism, thereby ensuring that applications can reliably extract MEV profits.

The Unichain verification network is a decentralized network composed of node operators responsible for verifying the latest state of Unichain and providing economic security guarantees through rapid finality, thus achieving a seamless experience for cross-chain transactions. This concept is similar to AltLayer's MACH (a rapid finality mechanism based on EigenLayer) and Nuffle's rapid finality layer, as well as the latest rapid finality ideas proposed by Symbiotic. To become a decentralized node of Unichain, participants need to stake UNI tokens on the Ethereum mainnet.

In each Epoch, the nodes holding the highest UNI balance will be selected into the active set and participate in verification by running the Reth Unichain client. Additionally, similar to other networks, UNI holders can choose to delegate their staked tokens to other nodes, thereby participating in network governance and profit distribution.