In a recent governance proposal, Flare has outlined a plan to become one of the first layer-1 blockchains to capture maximal extractable value (MEV) directly at the protocol level. This approach would redirect revenue currently flowing to external actors who profit from transaction ordering on major chains. MEV refers to the income generated by block builders through reordering, inserting, or censoring transactions within a block, effectively imposing a hidden tax on users through front-running, sandwich attacks, and arbitrage.

Estimates suggest that annual MEV revenues range from tens of millions on networks like Arbitrum to upwards of $500 million on Ethereum and as much as $1 billion on Solana. The proposed three-stage plan would integrate this revenue into Flare's token economics.

Initially, block building would transition from individual validators to a designated builder operated by the Flare Entity, with a fallback mechanism in place. The second stage would move block building into Flare Confidential Compute, making the process publicly auditable.

The final stage would merge the builder and proposer into a single entity, shifting existing validators to a verification role. Additionally, the proposal introduces FIRE, the Flare Income Reinvestment Entity, which would collect revenue from various protocol sources, including fees, and use it to buy back and burn FLR tokens, thereby reducing the token supply. Upon approval, several changes would take effect immediately, including a reduction in annual FLR inflation from 5% to 3% and a decrease in the hard cap from 5 billion to 3 billion tokens per year.

The base gas fee would increase 20-fold, from 60 gwei to 1,200 gwei, which is expected to raise the estimated annual FLR burn from approximately 7.5 million to 300 million at current transaction volumes. Despite this increase, the cost of a standard Flare transaction would remain a fraction of a cent. With its roots in the XRP ecosystem, Flare has distributed its initial token supply through an airdrop to XRP holders and has developed the FAssets system to bring smart contract functionality to assets on blockchains like XRPL. As of late March 2026, the network reports over $160 million in total value locked and more than 887,000 active addresses.