Front-running refers to a practice where an individual or entity takes advantage of advanced knowledge about upcoming transactions to profit at the expense of others. In the context of trading, this often happens when a trader notices a large order that will likely impact the price of an asset. Upon gaining this insight, the trader places their own order beforehand, hoping to sell at a higher price once the initial order is executed and alters the market. This practice undermines fair market conditions and can lead to significant losses for those unaware of the maneuver.In decentralized finance (DeFi), front-running occurs particularly in blockchain transactions. Traders can observe pending transactions in the mempool—the waiting area for transactions to be processed. By submitting their own transactions with a higher fee, they can ensure their trades are executed first, exploiting the original transaction’s price movement.Overall, front-running is viewed as an unethical practice that disrupts market fairness and transparency.