In a bold move, Flare has unveiled a governance proposal that would make it a pioneer in capturing maximal extractable value (MEV) at the protocol level, thereby reducing the hidden tax imposed on users by external actors. This innovative approach would redirect MEV revenue into the network's token economy.
The proposal is divided into three stages, starting with the transfer of block building from individual validators to a designated entity, followed by the integration of block building into Flare Confidential Compute, and finally, the merger of the builder and proposer into a single entity. Additionally, a new entity called FIRE would be established to collect revenue from various protocol sources, including MEV, and utilize it to buy back and burn FLR tokens, effectively reducing the token supply. If approved, the proposal would immediately decrease annual FLR inflation from 5% to 3%, with the hard cap reduced to 3 billion tokens per year. The base gas fee would also increase 20-fold, resulting in a significant rise in estimated annual FLR burn.
With its strong ties to the XRP ecosystem, Flare's FAssets system has already generated over 150 million FXRP, bringing smart contract functionality to assets on non-native blockchains like XRPL. As of late March 2026, the network boasts over $160 million in total value locked and more than 887,000 active addresses.