Order Sequencing Fairness

Order sequencing fairness is the principle that orders should be processed in the order they were received or according to a transparent, non-discriminatory rule. In centralized exchanges, this is often a point of contention, as the exchange has the power to prioritize certain orders over others.

This can be used to facilitate front-running or to provide advantages to favored clients. Ensuring fairness is essential for maintaining trust in the market.

Many modern protocols use techniques like batch auctions or cryptographic sequencing to ensure that order processing is fair and transparent. These methods prevent the manipulation of order flow and ensure that all participants have an equal opportunity to execute their trades at the prevailing market price.