Commitment Against Front-Running Attacks

Andrea Canidio and Vincent Danos
Additional contact information
Vincent Danos: DI-ENS - Département d'informatique - ENS-PSL - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - Inria - Institut National de Recherche en Informatique et en Automatique - CNRS - Centre National de la Recherche Scientifique

Post-Print from HAL

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). This paper was accepted by Joshua Gans, business strategy. Funding: The authors gratefully acknowledge the financial support of the Ethereum Foundation [Grant FY22-0840].

Date: 2023-09-06
New Economics Papers: this item is included in nep-gth
Note: View the original document on HAL open archive server: https://hal.science/hal-04310293v1
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in Management Science, 2023, ⟨10.1287/mnsc.2023.01239⟩

Downloads: (external link)
https://hal.science/hal-04310293v1/document (application/pdf)

Related works:
Journal Article: Commitment Against Front-Running Attacks (2024)
Working Paper: Commitment Against Front Running Attacks (2023)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04310293

DOI: 10.1287/mnsc.2023.01239

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().