The Key Neutrality of Baselayer Markets

Paradigm argues that MEV is a native, economically rational feature of Ethereum's decentralized architecture, and that regulatory intervention would risk disrupting a still-maturing, self-correcting market structure. The paper contends that the market is already addressing negative externalities through technical innovation, such as the MEV-Boost proposer-builder separation pipeline. It also argues that MEV activity alone does not meet the legal elements of securities fraud, insider trading, or best execution violations under U.S. law, and it urges the SEC to take a tech-neutral approach.