Censored Ethereum Blocks Decline to 35% Amidst Renewed Decentralization Efforts

Ethereum's mainnet is demonstrating increased resilience against censorship, with one prominent social media user, L Ξ O 🦇🔊🐼🕯, recently stating that it "appears healthier than ever in terms of censorship resistance 💪". This optimistic assessment comes after periods of significant concern regarding transaction censorship following the network's transition to Proof-of-Stake (PoS) and the impact of U.S. Office of Foreign Assets Control (OFAC) sanctions.

In the aftermath of the Merge, a substantial portion of Ethereum blocks became OFAC-compliant, meaning they actively excluded transactions linked to sanctioned entities, most notably the privacy service Tornado Cash. This compliance was largely driven by the widespread adoption of MEV-Boost relays, a critical middleware layer, where some providers chose to filter transactions to adhere to regulatory requirements. At its peak in late 2022, the percentage of OFAC-compliant blocks reached as high as 79%, raising alarms within the Ethereum community about the network's core principle of credible neutrality and permissionless access.

However, recent data indicates a notable reversal in this trend, signaling a positive shift towards greater censorship resistance. As of July 2024, the proportion of censored blocks has reportedly fallen significantly to approximately 35%.

This improvement is largely attributed to a combination of vocal community backlash and the strategic emergence of new, non-censoring MEV-Boost relays, which have provided validators with more diverse and ideologically aligned options. Key infrastructure providers, such as Beaverbuild, a major block builder, have also publicly announced their decision to cease censoring transactions, further contributing to this positive trajectory.

Technical developments are also playing a crucial role. Projects like SUAVE ("Single Unifying Auctions for Value Expression") are actively being pursued to decentralize block building itself, aiming to reduce reliance on centralized intermediaries. Furthermore, proposals such as "Relay Block Merging" are being explored to enhance censorship resistance by enabling non-censoring relays to re-include filtered transactions, thereby limiting inclusion delays for all users.

Despite these significant strides, challenges such as the broader centralization of Maximal Extractable Value (MEV) extraction and the concentration of staked ETH within large entities like Lido and Coinbase continue to be areas of focus for the community. Nevertheless, the concerted efforts to develop and implement protocol-level and social-layer solutions underscore a robust commitment to maintaining the decentralized and permissionless nature of the Ethereum blockchain, ensuring its long-term health and integrity.