Flash Freezing Flash Boys: Countering Blockchain Front-Running
Flash Freezing Flash Boys presents a detailed analysis of front-running in traditional exchanges and blockchain, showcasing various attacks like Displacement, Insertion, and Suppression. Explore the impact of front-running on transactions and learn about regulatory practices.
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Presentation Transcript
Flash Freezing Flash Boys: Countering Blockchain Front- Running Haoqian Zhang, Louis-Henri Merino, Vero Estrada-Gali anes and Bryan Ford cole Polytechnique F d rale de Lausanne (EPFL) 1
Outline Front-running in Traditional Exchange Front-running in Blockchain Flash Freezing Flash Boys(F3B) Overview Experiment 2
Traditional Exchange Buy 400,000 shares Buy 400,000 shares Customer Broker Exchange 3
Front-running in Traditional Exchange Buy 20,000 shares Buy 400,000 shares Sell 20,000 shares Buy 400,000 shares Customer Broker Exchange 4
Front-running in Traditional Exchange Front running is the practice of entering into a trade to capitalize on advanced, nonpublic knowledge of a large pending transaction that will influence the price of the underlying security. Prohibited practice by regulations. 5
Blockchain Transaction Transaction Customer Blockchain Miner 7
Front-running in Blockchain Displacement Attack: Transaction Transaction Customer Blockchain Miner 8
Front-running in Blockchain Insertion Attack: Transaction Transaction Transaction Transaction Customer Blockchain Miner 9
Front-running in Blockchain Suppression Attack: Transaction Transaction Customer Blockchain Miner 10
Front-running in Blockchain A front-running attack is a practice where an entity benefits from early access to some pending transactions. No regulation. Front-running attacks cause a loss of 280M each month worldwide*. * https://cybernews.com/crypto/flash-boys-2-0-front-runners-draining-280-million-per-month-from-crypto-transactions/ 11
Strawman: Commit-and-Reveal by User Tx: Tx: Value so that Hash(Value) = Commit Commit Drawbacks: (1) Two transactions (2) Suppression Attack possible 12
Transaction Commitment Execution Time Commitment Time m block confirmations Time: Time: 13
F3B: Supporting encrypted transactions* Execution Time Commitment Time m block confirmations Time: Time: * Requires the modification at the blockchain architecture layer. 14
How does F3B mitigate front-running A front-running attack is a practice where an entity benefits from early access to some pending transactions. Reasoning from definition: transactions are encrypted before commitment -> attackers can not benefit from pending transactions. 15
Architecture Overview Senders Secret-management committee (2) Release keys after commitment (1) Publish encrypted transactions Consensus Group 16
Protocol 17
Protocol 18
Protocol 19
Latency* Ethereum Block Time = 13s Block confirmations = 20 => Latency = 260s F3B with 128 nodes Latency 1.77s 0.68% latency overhead in Ethereum * We ran our experiment on a server with 32GB of memory and 40 CPU cores running at 2.1GHz. 20
Throughput* Ethereum Around 15tps F3B with 128 nodes 13.2tps Latency 9.7 seconds 3.7% latency overhead in Ethereum * We ran our experiment on a server with 32GB of memory and 40 CPU cores running at 2.1GHz. 21
Conclusion Front-running is a big issue in blockchain/DeFi Mitigates front-running attacks Requires modification of blockchain architecture Presents low latency overhead 22
