Front-Running Attack

Crypto terminology for Frontier Wallet offers clear definitions of key blockchain and cryptocurrency terms, helping users navigate their digital asset management with ease.

A front-running attack occurs when a trader or bot takes advantage of upcoming transactions that have not yet been executed. This typically involves observing pending orders in a decentralized exchange or on a blockchain platform.In this scenario, the attacker sees a large buy order that is about to be processed. Anticipating that this will drive the price of the asset up, the attacker quickly places their own buy order first. Once the large order goes through and the price rises, the attacker sells their tokens for a profit.This practice is considered unethical and can undermine trust in trading platforms. Front-running exploits the transparency of blockchain, where transaction data is visible before confirmation, allowing malicious actors to gain an unfair advantage over regular traders.To counteract front-running, some platforms are implementing measures like order randomization and delayed transaction processing. Nonetheless, it remains a significant issue, highlighting the need for improved security and fairness in trading practices.

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