In a bid to revolutionize its token economics, Flare has introduced a governance proposal that would make it a pioneer in capturing maximal extractable value (MEV) at the protocol level. This move would redirect MEV revenue away from a select few specialized actors and into the protocol itself. MEV is generated through the reordering, insertion, or censorship of transactions within a block, resulting in a hidden tax on ordinary users through practices like front-running, sandwich attacks, and arbitrage. According to external estimates, MEV revenues can reach tens of millions of dollars on networks such as Arbitrum, upwards of $500 million on Ethereum, and as high as $1 billion on Solana.

The proposed three-stage plan would funnel this revenue into Flare's token economics. Initially, block building would transition from individual validators to a designated entity operated by the Flare Entity, with a fallback to the current model if needed. The second stage would involve moving 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 attestation fees, FAsset and Smart Account fees, confidential compute fees, and captured MEV. FIRE's primary objective is to reduce the FLR token supply through open-market buybacks and burns. Upon approval, several changes would take effect immediately, including a reduction in annual FLR inflation from 5% to 3%, with the hard cap decreasing to 3 billion tokens per year from 5 billion. The base gas fee would increase 20-fold, from 60 gwei to 1,200 gwei, resulting in an estimated annual FLR burn of 300 million at current transaction volumes.

Even with this increase, a standard Flare transaction would remain extremely low-cost. With its roots in the XRP ecosystem, having distributed its initial token supply through an airdrop to XRP holders in 2023, Flare's FAssets system has produced over 150 million FXRP, bringing smart contract functionality to assets on blockchains like XRPL that do not natively support it.

As of late March 2026, the network boasts over $160 million in total value locked, with more than 887,000 active addresses.