Commitment Against Front-Running Attacks

Andrea Canidio and Vincent Danos ()
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Vincent Danos: Département d’Informatique de École Normale Supérieure, Centre National de la Recherche Scientifique (CNRS), 75005 Paris, France

Management Science, 2024, vol. 70, issue 7, 4429-4440

Abstract: We provide a game-theoretic analysis of the problem of front-running attacks. We use it to distinguish attacks from legitimate competition among honest users for having their transactions included earlier in the block. We also use it to introduce an intuitive notion of the severity of front-running attacks. We then study a simple commit-reveal protocol and discuss its properties. This protocol has costs because it requires two messages and imposes a delay. However, we show that it prevents the most severe front-running attacks while preserving legitimate competition between users, guaranteeing that the earliest transaction in a block belongs to the honest user who values it the most. When the protocol does not fully eliminate attacks, it nonetheless benefits honest users because it reduces competition among attackers (and overall expenditure by attackers).

Keywords: front running; game theory; MEV; transactions reordering; commit-reveal (search for similar items in EconPapers)
Date: 2024
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http://dx.doi.org/10.1287/mnsc.2023.01239 (application/pdf)

Related works:
Working Paper: Commitment Against Front Running Attacks (2023)
Working Paper: Commitment Against Front-Running Attacks (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:70:y:2024:i:7:p:4429-4440

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