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

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

#51

Post by [deleted] »

legutierr wrote: post #39
morelisp wrote: post #34

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. 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.

It is so curious that you use the term “fiduciary duty” to describe the relationship between a miner and the signers of the transactions it includes in its mined blocks. The primary rationale of fiduciary duty is trust. In contrast, the whole reason that miners even exist is so that the service they provide can be performed in an entirely antagonistic environment, without trust. I suppose it can be said that a miner’…

[deleted]

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

#52

Post by SilasX »

dchftcs wrote: post #11
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.

It's not appropriate, because it's a poor generalization to begin with. People just see "frontrunning" and have a vague sense it's fundamentally illegitimate because of vague connections to the illegal practice, and yell things that make no sense on wsb and the like. The usage is popularized because it makes sensationalist headlines and forum headers, that the "generalized usage" was either misguided or intended to c…

> It's not appropriate, because it's a poor generalization to begin with. People just see "frontrunning" and have a vague sense it's fundamentally illegitimate because of vague connections to the illegal practice

No, not because of vague connections, but because it does the same kind of destructive thing that’s bad (for the ecosystem) for the same reason it’s bad on the normal market: it extracts value from a transaction because of timing and a privileged position, disencentivizing positive-sum behavior. (In the broker’s case, because of knowing about the transaction; in the miner’s, because of having that mining power and being able to quickly execute on knowledge of upcoming transactions.)

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

#53

Post by unethical_ban »

dehrmann wrote: post #20
neatze wrote: post #12

Earlier quoted context omitted.

In past few years, I got calls with offer to build artificial market making models (aka pump and dump) for crypto exchanges, with 7 figures payout per model + commission, I refuse to do such work, this is just disgusting, don't care how legal or illegal this is, it did not seem they have infrastructure for HFT in terms of Order Routing like it is on stock exchanges like BATS etc ...

Is it any more disgusting than people speculating in crypto, but lying to themselves and calling it an "investing?"

Yes.

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

#54

Post by righttoolforjob »

kuished wrote: post #36
righttoolforjob wrote: post #32

Earlier quoted context omitted.

Except that is mostly printed money. You can't take the crypto market cap seriously. If a significant portion of it tries to get converted from "magic internet money" to real money the price will plummet.

You realise that applies to “real money” too right?

What do you mean? When converting real money to...?
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