Crypto glossary
Proposer-builder separation (PBS)
Proposer-builder separation (PBS) splits block creation: specialised builders assemble blocks and bid, and validators propose the highest-paying one.
Building a profitable Ethereum block requires tracking MEV opportunities, private order flow and complex transaction ordering, work that favours sophisticated firms. PBS separates that job from proposing. Builders compete to assemble the most valuable block and offer a payment to the proposer, and the validator chosen for the slot picks the best bid without needing to see or understand the contents first.
Until enshrined PBS is live, PBS runs outside the protocol through MEV-Boost, where trusted relays sit between builders and validators. Most Ethereum blocks are produced this way, letting home stakers capture MEV income similar to large operators. Enshrined PBS (ePBS), specified in EIP-7732 and the headline change of the Glamsterdam upgrade, moves the auction into the protocol and removes the dependence on relays.
PBS contains the centralising pull of MEV on validators but shifts it to builders, a small group of which assembles most blocks. That raises censorship concerns, which proposals such as inclusion lists aim to address. PBS is part of the Scourge branch of the Ethereum roadmap.
Example
A home validator chosen to propose a block receives bids from several builders through relays and signs the header of the highest one without building anything itself.