What is Front Running
Front Running refers to miners being able to see the content of pending transactions. When they discover a high-priced transaction, they can insert a transaction before it to profit themselves. For example, Alice decides to purchase a scarce token with a bid of 10 ETH. This transaction is publicly visible on the blockchain. Eve, a malicious miner, sees Alice's transaction and immediately bids 9.9 ETH to purchase the token. Afterward, Alice's transaction is packaged, and Eve sells the token to Alice for 10 ETH. This way, Eve earns the price difference.
Methods to Prevent Front Running
Use a Mixer
A mixer can shuffle transactions to avoid directly exposing transaction content. Users send coins to the mixer, which mixes the coins of multiple users together and then sends them to different addresses. This effectively hides the transaction chain and amount.
Reduce Dependency on the Blockchain for Trading Pairs
Trading can be conducted off-chain through methods such as state channels or sidechains, only interacting with the blockchain when opening and closing. This reduces the transaction load on the blockchain and avoids third-party viewing of transaction content.
Use Zero-Knowledge Proofs
Zero-knowledge proofs can prove the validity of a transaction without revealing the actual transaction content. This method effectively prevents Front Running.
Code Example:
Below is a simple Solidity code example that uses a mixer to hide the actual bid.
// Mixer contract
contract Mixer {
// Collect funds from multiple users
function deposit() external payable {
...
}
// Mix multiple users' funds
function mix() external {
...
}
// Withdraw to a separate address
function withdraw(address payable to) external {
...
}
}
// Purchase contract
contract Purchase {
// User deposits to mixer
function depositToMixer() external payable {
Mixer(mixer).deposit{value: msg.value}();
}
// Purchase from mixed funds
function purchase(uint value) external {
Mixer(mixer).withdraw(payable(seller));
// Additional purchase logic
}
}