Introducing Rebar Labs: MEV-Aware Products and Infrastructure for Bitcoin

Bitcoin, the world's largest digital asset, is experiencing the emergence of a vibrant on-chain ecosystem. The introduction of new token standards, including Runes and BRC-20s, as well as the deployment of L2s and rollups are bringing sophisticated market activity and economics to the first and longest-running cryptocurrency.

This programmatic functionality grows alongside Bitcoin's newfound traditional markets exposure via its spot ETFs. This combination creates the perfect conditions for a new Bitcoin-based on-chain economy.

Such activity on Bitcoin today is reminiscent of the early stages of Ethereum DeFi, and, just as it has on Ethereum, we believe MEV behavior will proliferate on Bitcoin. MEV strategies, such as frontrunning, sniping, and transaction censorship, are now occurring on Bitcoin, potentially extracting value from users and/or withholding value from miners.

Rebar Labs is providing infrastructure, data products, and research that will empower Bitcoin users and miners to navigate the emerging MEV landscape while preserving the network's core principles of decentralization, security, and fairness.

MEV, or Maximum Extractable Value, refers to the potential profits that can be earned by strategically ordering, including, or excluding transactions within a block.

Ordinals and BRC-20 tokens are today's most prominent and easily understood examples of MEV on Bitcoin. To gain an advantage in on-chain markets, sophisticated users and miners can engage in sniping for Ordinal collections and exploit the “first is first” principle in BRC-20 minting. Furthermore, as decentralized exchanges for these tokens emerge, more traditional MEV strategies like frontrunning, backrunning, and sandwich attacks become possible.

While MEV has been extensively studied on Ethereum, leading to services like Flashbots that help users mitigate and even utilize MEV activity, its presence on Bitcoin remains largely unexplored. This knowledge gap is particularly significant due to Bitcoi's quickly evolving ecosystem of metaprotocols and L2 chains.

We plan to research and document previously unexplored MEV activities on Bitcoin, sharing these findings to foster broader understanding of Bitcoin's evolving ecosystem and associated MEV activities.

We've raised $2.9m to provide products, infrastructure, and research that will empower Bitcoin as it evolves in this new paradigm. We recognize the significance of this shift and are positioned to help Bitcoin users and miners navigate the challenges — and opportunities — of the emerging MEV landscape.

For users, Rebar's infrastructure will address the potential challenges and opportunities presented by MEV on Bitcoin, including defending against frontrunning, transaction censorship, and other strategies that could impact market fairness and transaction execution.

For miners, Rebar Labs is positioned to address diminishing block rewards by providing opportunities to subsidize mining revenue with MEV activity, while also promoting the health of Bitcoin's growing ecosystem.

Our goal is to ensure that Bitcoin's evolution remains true to its core principles of decentralization, security, and fairness for all participants.

Rebar Labs will concentrate on these following areas, with our first product launch coming this summer.

1. Infrastructure: Launching an alternative to the public mempool via private transactions, providing new sources of revenue for miners as block rewards diminish, optimizing block construction and fees, and supporting wallet providers in integrating Rebar's new products.

2. Products: Building tools to demystify Bitcoin's new on-chain ecosystem and illuminate MEV as it emerges, beginning with data products and dashboards to provide in-depth analytics of Bitcoin's on-chain activity — like Runes and BRC-20 transactions.

3. Research: Providing pioneering analysis, articles, and reports on new, unexplored activities on Bitcoin, with a focus on MEV.

Rebar Labs is founded by a veteran crypto-native team with extensive experience across the cryptocurrency space, including building Bitcoin bridge technology and working with MEV on Ethereum.

We're proud to have raised from 6th Man Ventures, Arca, ParaFi Capital, Moonrock Capital, and UTXO Management. Their support and expertise will be invaluable as we work towards realizing our vision of a more robust Bitcoin ecosystem.

As more new features come to Bitcoin, our team expects to see a very substantial increase in trading volume, with more and more Bitcoin users participating in new types of opportunities and strategies.

Follow us on X to keep up on our progress and upcoming product launches. Together, we can build a stronger, more resilient Bitcoin ecosystem.