MEV and Frontrunning Risks

Maximal Extractable Value refers to the profit that validators or searchers can make by including, excluding, or reordering transactions within a block. Frontrunning is a specific type of MEV where a participant observes a pending transaction in the mempool and submits their own transaction with a higher gas fee to be processed first.

This allows the attacker to manipulate the price before the original trader's transaction is executed, effectively profiting from the victim's price impact. This practice is a significant concern for market fairness and user experience in decentralized finance.

It forces traders to use private transaction relays to hide their orders from the public mempool. Understanding MEV is essential for grasping the adversarial nature of blockchain order flow.