Define ‘Front-Running’ and How It Exploits Low Finality in Trading

Front-running is a malicious practice where a party, often a validator or a searcher, sees a pending transaction and executes their own transaction ahead of it to profit from the anticipated price movement. Low finality on Layer 1 provides a window of opportunity for this.

By submitting their transaction with a higher gas fee, they ensure their trade is included in an earlier block, exploiting the delay before the original transaction is confirmed.