In the world of blockchain, not all transactions are created equal. Some are straightforward journeys from point A to B, while others unfold in high stakes arenas where timing can make or break fortunes.

This article explores these distinctions, the perils and perks of speed obsessed systems, and how innovative designs like Ergos sub blocks aim to create a fairer playing field.

We need to start with highlighting a major difference that is often overlooked.

External race conditions: Racing external market conditions, and payment expectations between users.

Internal on chain race conditions: The internal race across shared state.

Defi is a completley different animal here that presents layers of complexity that are often overlooked and not understood.

The Basics: Send and Receive Systems versus DeFis Internal Race Battles

Start with the simplest blockchain interactions: sending and receiving tokens, like transferring Bitcoin or Ether between wallets.

These are external races, where the main challenges come from outside the protocol itself.

You submit your transaction, pay a fee, and wait for miners or validators to include it in a block. Delays might stem from network congestion during market hype or fluctuating token prices affecting fee calculations.

The outcome is predictable. Your tokens arrive eventually, subject only to broad market forces. External pricing on markets, and external demands in terms of payment timing.

Now, contrast this with DeFi, or decentralized finance, where users trade, lend, or borrow on chain. Here, internal races dominate.

Multiple transactions compete to update the same shared state, such as a liquidity pool on Uniswap. If you try to swap tokens, a bot might spot your move in the public mempool, or transaction pool, insert its own trade first through front running, and profit from the price shift you caused. This is not just waiting. It is a cutthroat competition where internal mechanics like block ordering and execution speed determine winners.

Building complexity, these races enable maximal extractable value, or MEV, where sophisticated actors extract billions annually through arbitrage or liquidations, often at retail users expense.

The key difference? External races are cooperative queues.

Internal ones are adversarial games, amplifying inequalities in access and tech.

Low Latency Systems: Speeds Double Edged Sword

Low latency blockchains, like Solana with its roughly 400 millisecond block times, promise lightning fast DeFi. The mantra? He who controls order flow is king. This means those who dictate transaction sequencing through speed or connections reap the rewards. Simply put, faster systems let users execute trades in near real time, mimicking centralized exchanges.

This does boosts adoption.

Imagine swapping assets without waiting minutes, reducing slippage, or unfavorable price changes, and enabling high frequency strategies.But advantages come with tradeoffs.

Pros include enhanced efficiency. More transactions per second, or TPS, support complex DeFi apps, attracting liquidity and innovation.

Risks? Centralization creeps in. It dominates.

Ultra low latency favors elites with co located servers near validators, premium relays, or bots that outpace humans.

This creates kings of order flow, where a few firms dominate MEV, extracting value while everyday users face front running losses.

Tradeoffs deepen with security. Shorter block times increase fork risks, or competing chains, demanding flawless network propagation. In volatile markets, spam attacks exploit this, hiking fees unpredictably.

Cons outweigh for fairness.

Low latency widens the gap between pros and casuals, undermining decentralizations ethos.

While speed drives growth, it risks turning blockchains into walled gardens controlled by the swiftest.

This risk is never talked about by the TPS crowds.

Never forget. He who controls order flow is king.

Systems with advantages for the fastest player will always benefit from liqudity in the short term. Why would they not? The incentives are there.

The question is will people accept that the system has advantages uniquely tailored to a select few.

The Scaling Dynamics of Ultra Fast Systems: Incentives for Liquidity Providers and Risks to Retail

Ultra fast blockchains scale by rewarding speed above all else. At a basic level, they encourage liquidity providers to act like high speed traders. Providers add funds to pools for fees, but in low latency environments, the real incentive is capturing fleeting opportunities like arbitrage before others do.

This draws in professional firms with advanced tech, boosting overall liquidity as more capital flows to these efficient markets.

However, this creates extractive dynamics for retail users. Fast players consistently win races, front running trades or sniping liquidations to extract value directly from everyday participants. Retail traders, lacking the same tools, face worse prices and hidden costs, turning DeFi into a wealth transfer from casuals to elites.

Building complexity, this centralizes liquidity around a few dominant actors who control order flow through sheer speed. Such concentration poses dangers for free and fair systems. It fosters monopolies where “kings” dictate terms, eroding decentralization.

With enough velocity, these kings always prevail, leaving users at a massive disadvantage.

Ultimately, we revert to traditional finance style controlled systems, where power consolidates rather than distributes.

Ergos Sub Blocks: Harmonizing Speed, Fairness, and User Experience

Ergo, a proof of work blockchain emphasizing secure DeFi, tackles these issues with sub blocks. The foundation for is a feature activated in Sigma 6.0 upgrade in September 2025.

At its core, sub blocks split processing. Input blocks, or sub blocks, handle quick transaction inclusion every roughly 1 second at lower difficulty, while ordering blocks, or traditional blocks, finalize consensus every roughly 2 minutes.

This keeps user experience snappy.

Users get near instant confirmations for DeFi actions like swaps, detecting failures in seconds instead of minutes, without shortening the main block time.

Building on this, sub blocks provide a better UX but curb fastest player dominance.

Press enter or click to view image in full size

Longer ordering intervals allow natural network delays to level races, reducing the edge of millisecond optimized bots in internal DeFi competitions.

You can think of every block as an auction. The auction driven by demand and competition for block space, it is fee driven.

I believe there are benefits in allowing participation with less advantages for fairer markets. I also believe having enough delay or time for this fee market to develop is beneficial for miners.

Transactions propagate cooperatively via frequent sub blocks, easing front running and giving fee markets time to mature organically.

Miners benefit from stable, fairer fees. More predictable inclusion means less spam driven volatility, boosting revenue without user experience hits. In essence, Ergo balances low latency perks with deliberate pacing, fostering inclusive DeFi where speed serves all, not just elites.

Toward Fairer Horizons: Empowering Miners and Decentralizing MEV

Fairer fee markets, as in Ergos model, shift power from insiders with the fastest systems to miners who secure the network. Insiders thrive in low latency chaos by monopolizing order flow, but extended cycles let fees reflect true value, rewarding miners work over hardware arms races. The logical endgame?

Miners optimizing blocks for MEV in a free market fee competition, where anyone can bid transparently.

Distributing production across lots of decentralized block producers, via accessible proof of work like Ergos ASIC resistant design, prevents kings from controlling order flow, spreading MEV profits widely and true to blockchains decentralized promise.

Ethereum imo was the best system with fees were collected and distributed to miners. This is when the hashrate grew the most. The system was secured by this feedback loop.

In Proof of Stake this feedback mechanism appears to accelerate the centralization of block production and profit extraction.

Let’s see, time always shows the truth.