Solana
3 reasons why Injective is a safe space?
Ethereum and Solana are struggling to deal with the MEV bot. In the midst of all this, could the Injective Protocol (INJ) be the refuge against sandwiching?
Looking at the bigger picture, Ethereum and Solana could be two of the biggest innovative platforms in the crypto world. The only problem is that, like most open systems, making transactions can mean getting destroyed.
How to lose money quickly on MEV bot $NPC become crazy pic.twitter.com/RobpooVstB
–Johnny Fap (@cryptojohnnyfap) June 12, 2024
The Problem: MEV Bots Are Actively Extracting Value
The robots are on the prowl and they mean no good for you.
For those who don’t know, or who might have been affected by Miner Extractable Value (MEV), the bottom line is clear: there are sharks, and they are ready to “kill.”
Although MEV robots exist, they are becoming more common on Solana than on Solana. Ethereum.
On Ethereum, the world’s highest gas fees pose a barrier to entry for MEV bots. Only those with strong support can operate profitably.
Solana, on the other hand, uses a similar system but with fees close to zero. This “welcome feature” has created a melee for all MEV bots, raising concerns about fairness and security.
The situation has become so dire that the Solana Foundation recently banned over 30 validators for allegedly enabling MEV activity.
The question now remains? Is there a safe space for users to deploy smart contracts or trade without getting sandwiched?
It turns out that Injective Protocol stands out as a beacon of hope. Like Bitcoin, Injective has complete resistance to MEV.
This achievement is particularly intriguing given that Injective, like Ethereum, also has a transaction memory pool, a common element associated with MEV mining.
Unpacking the INJ: is the injective protocol a glimmer of hope?
So how does Injective achieve this feat? The answer lies in its frequent batch auction (FBA) system.
In an article on X, FBA, Injective saidis a decentralized mechanism that tackles MEV head-on while strengthening network security.
1/ 🚀 Injective’s native MEV resistor is powered by its innovative Frequent Batch Auction (FBA) system. This decentralized method not only prevents front-running, but also improves overall network security. Let’s explore how it works! 🧵👇
— Injective 🥷 (@injective) June 11, 2024
And how it works is even clearer than day.
To begin, all transactions are grouped and processed together at predefined intervals. This means that validators do not have to compete for time when processing transactions and adding them to a block. By removing the race against time, Injective prevents validators and MEV bots from taking advantage of timing to scam users.
And it doesn’t stop there. Once grouped, all transactions are executed at a single, uniform price. As a result, it is impossible to manipulate order prices within a given lot.
Execution doesn’t happen like that either. All transactions, Injective said, are sealed until the end of the auction. Sealing trades is a major benefit because it prevents network bots from peeking into other orders, allowing them to adjust their own to gain an unfair advantage.
DISCOVER: Like the injective protocol? You will love these other projects!
MEV Resistance Because of DeFi-Focus?
Combining them all, Injective said its network processes orders fairly, tactically handling MEV tactics such as front, back-run, and sandwich attacks.
As innovative as it may seem, Injective is unfortunately only a DeFi-focused platform and its market capitalization is much smaller than Solana and Ethereum.
Since finance is the motive and Injective prevents exploitation by all means, running MEV bots on the network might not be a lucrative business.
EXPLORE: Uniswap Founder Thinks Ethereum Layer-2 Transactions Shouldn’t Be Immutable, Here’s Why
Warning: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose your entire capital.