Block Builder

Overview

Block building is the process of deciding which valid transactions and other operations should be included in a candidate block and in what order. In some protocols, the block producer performs this work directly. In proposer-builder separation designs, specialized builders construct execution payloads and offer them to proposers.

Builders consider fees, gas or weight limits, transaction dependencies, bundle conditions, and maximal extractable value opportunities. They must still produce a block that the network’s nodes will validate. A builder cannot make an invalid transaction valid simply by including it.

Centralized builder markets can improve efficiency but create concerns about censorship, transaction privacy, and concentration. A small number of builders may gain visibility into order flow or influence which transactions are included. Protocol and relay designs attempt to reduce these risks.

The term is context-specific. In Bitcoin, miners or mining-pool software build block templates. In modern Ethereum, “builder” often refers to the specialized execution-payload builder in the MEV supply chain.

A builder evaluates public mempool transactions, private order flow, bundles, gas or weight limits, and dependencies between operations. It then creates a candidate payload and, in separated markets, bids for a proposer to include that payload. The proposer remains responsible for choosing a valid block according to the protocol.

Specialized building can improve efficiency and reduce the burden on validators, but it can also concentrate power. Builders may gain visibility into private transactions, influence ordering, or exclude activity. Competition, relay design, censorship monitoring, and protocol-level inclusion mechanisms are therefore important governance and security concerns. A builder cannot make an invalid transaction valid; full nodes still enforce consensus rules and reject a block that violates them.