Arbitrum’s transaction sequencing system, Timeboost, has generated a revenue of $2 million since its introduction in April 2025, as confirmed by Dune Analytics. This system, designed to enhance efficiency and alleviate MEV-related issues within the Arbitrum network chains, has become a significant income source for Arbitrum DAO. Timeboost is currently operational on both Arbitrum One and Arbitrum Nova platforms.
With its ability to process hundreds of thousands of transactions, Timeboost has particularly found favour in high-frequency DeFi trading, accounting for 20-30% of daily DEX volume on Arbitrum. Traditionally, Arbitrum chains process transactions on a First-Come, First-Served (FCFS) basis. However, this has proven to have limitations, especially as MEV hunters frequently overwhelm the network with transactions to ensure their inclusion, leading to network congestion and inefficiencies.
To address this issue, Offchain Labs launched Timeboost, a system that allows MEV hunters to bid for transaction priority. Timeboost alters the FCFS principle by implementing a sealed-bid, second-price auction to govern its “express lane”. This not only enables chain owners to capture MEV revenue and mitigate network spam but also ensures faster block times while shielding users from front-running and sandwich attacks.
While Timeboost helps to control spam and congestion, it also serves to generate value for the Arbitrum ecosystem. Nevertheless, there are concerns about possible centralization risks, as the monetization of sequencer revenue may discourage the decentralization of the sequencer.
As an Ethereum Layer-2 scaling solution, Arbitrum generates income through several mechanisms, Timeboost being one of them. It imposes Layer 1 transaction fees on users to cover the cost of relaying transaction data to the Ethereum mainnet for security and finality. Additionally, there are Layer 2 fees that cover the operational costs of running the Arbitrum network, which includes computation and storage on the Layer 2 chain. All surplus L1 fees and L2 fees, after covering Ethereum costs, are directed to the Arbitrum DAO treasury. Presently, the Arbitrum DAO treasury possesses approximately 3.5 billion ARB tokens, valued at approximately $1.3 billion.
