Flash Boys 2: Frontrunning, transaction reordering, consensus instability (2019)

Post by BozeWolf » Sun, May 08, 2022, 8:52 AM UTC

mgaunard wrote: post #27

seibelj wrote: post #21

Anyone who doesn’t like crypto doesn’t have to play with it. It’s a tiny blip of nothing in size when compared to actual markets, and the “crime” that exists in crypto is nothing compared to what large banks facilitate for drug kingpins and oligarchs every single day. Let this weird parallel financial system develop for another decade and see what comes out of it. Might actually solve some problems.

It's not a tiny blip, it's already bigger than European equities...

Post by t_mann » Sun, May 08, 2022, 10:04 AM UTC

ruuda wrote: post #26

This was the paper that got it started, but now a few years later, strategies have gotten much more advanced. There was an entire conference day devoted to it a few weeks ago, with some interesting talks, if you are interested in the state of the art: https://flashbots.notion.site/MEV-DAY-836f88806995412dabc1c7...

Post by usednet » Sun, May 08, 2022, 10:18 AM UTC

BozeWolf wrote: post #31

mgaunard wrote: post #27

Earlier quoted context omitted.

It's not a tiny blip, it's already bigger than European equities...

Not sure what numbers you compared, but quick research on market cap [1,2]: European market cap 2019: 8,078,748,800,000 (8 trn) Coinmarketcap today: 1,583,350,504,806 (1 trn) Not a tiny blip. Compared to world equity 2021 [3]: 117 trn I would call it a small blip. 1: https://tradingeconomics.com/european-union/market-capitaliz... 2: https://coinmarketcap.com/ 3: https://www.sifma.org/resources/research/research-quart…

Post by syzygyhack » Sun, May 08, 2022, 11:50 AM UTC

finexplained wrote: post #9

zydex wrote: post #8

Earlier quoted context omitted.

I think (1) is a bit harsh relating to the terminology. Technically front running is based on plainly “non-public” information. The term has been generalised and expanded to include crypto transactions which are slightly more obfuscated from the average user who doesn’t sit and watch the mempool. I think the term is completely appropriate.

I respectfully don't think it is too harsh. Every legal definition I know of frontrunning requires a client relationship. Even in the case of "non-public" information, frontrunning refers to trading ahead of your client based on non-public information related to the clients securities. Trading on non-public information when a client is not involved is referred to as insider trading. Also in this context, the reason t…

Post by legutierr » Sun, May 08, 2022, 12:17 PM UTC

morelisp wrote: post #34

legutierr wrote: post #23

Earlier quoted context omitted.

There is no way that every transaction signer whose transaction is added to a block should be considered a client of the miner of that block. Most likely none of the transaction signers qualify as clients of the miner. Transactions are transmitted over the network anonymously via a gossip protocol, and hundreds or thousands of miners have the chance to include (or not include) any transaction in a block. Transactions…

> There is no way that every transaction signer whose transaction is added to a block should be considered a client of the miner of that block. This does not seem obvious to me; even if "client" is too strong a word, the transaction signer and miner have some social contract that's very similar to more traditional fiduciary duty, even if the technical details and enforcement mechanisms are totally different.