How Does Front-Running Relate to Information Leakage in Public Crypto Markets?

Front-running occurs when a party with advance knowledge of a large pending trade executes their own trade first to profit from the anticipated price movement. In crypto, this information leakage can happen through analyzing public mempools or through internal exchange knowledge.

Dark pools and OTC desks prevent this by keeping the large order intent hidden from the public order book until execution. This protection is crucial for institutional-sized orders.