Smart Contract Front Running

    Front Running of Smart Contracts: What It Is and How To Avoid It

    A smart contract enables automated, decentralized transactions without the need for intermediaries in blockchain technology. A smart contract is, however, vulnerable to attacks and exploitation as with any new technology. A smart contract front-running vulnerability is one example of such a vulnerability. The purpose of this blog post is to explain what smart contract front running is, how it works, and how it can be prevented.

    How does Smart Contract Front Running work?

    In smart contract front-running, an attacker attacks the network by exploiting the time delay between when transactions are broadcast to the network and when they are executed. Attackers do this by placing a higher gas fee transaction in front of the target transaction, delaying or failing it.

    Front running in smart contracts: how does it work?

    Front-running smart contracts exploit the delay between when a transaction is broadcast to the network and when it is executed. Users submit transactions to the network, and miners are always going to select the one with the highest gas fee to include in the next block. An attacker placing a higher gas fee transaction in front of a target transaction may cause the target transaction to fail or be delayed.

    Take Alex, for instance, who wants to purchase a cryptocurrency token for $100. Using 10 gwei as gas fee, Alex submits a transaction to the network. Seeing Alex’s transaction, Evil-Monitor Uber Hacker places a transaction with a gas fee of 15 gwei in front of Alex’s transaction. As a result, Alex’s transaction is delayed or even fails, allowing Evil-Monitor Uber Hacker to buy the token at a lower price before Alex.

    What are the best ways to prevent smart contracts from being front-run?

    The following methods can be used to prevent smart contracts from being front-run:

    A higher gas price will result in the transaction being processed faster, reducing the chance of front-running.

    Make the transaction harder to front run by using a smart contract wrapper. Smart contract wrappers hide the details of the transaction.

    Make use of private transactions: Private transactions can be used to hide transactions from the public network, making it harder for attackers to front-run them.

    Rely on a trusted oracle: A trusted oracle can verify the price of a token, reducing the chances of front running.

    If you have never seen the mempool here is a site that has a dashboard for what is happening in that transaction space.

    Blockchain smart contract technology and its users are at risk from smart contract front running. To prevent smart contract front running, you can either raise the gas price, use a smart contract wrapper, use private transactions, or use a trusted oracle. All of these strategies will help to protect users and their assets from front running. Additionally, users can also use other techniques such as batching transactions and using transaction logs to track their transactions. Keeping up with the latest security threats and solutions is important as blockchain technology continues to evolve.

    Here is a video from our Secure Programming in Solidity Course on YouTube

    If you want, you can take our overview of Secure Programming in Solidity on uDemy and learn more interesting things about how Solidity works.

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