What Is the “Mempool” and Why Is Its Transparency a DEX Vulnerability?
The mempool (memory pool) is a waiting area for unconfirmed transactions on a blockchain network. All submitted transactions sit here before being picked up by a miner or validator and included in a block.
Its transparency is a DEX vulnerability because it allows anyone, particularly automated bots, to monitor pending, potentially large transactions and calculate the likely price impact. This public visibility enables the front-runner to quickly submit a counter-transaction with a higher gas fee to execute first and profit.
Glossar
Vulnerability
Exposure ⎊ Vulnerability within cryptocurrency, options, and derivatives manifests as quantifiable risk to capital stemming from imperfectly hedged positions or systemic dependencies.
Transparency
Principle ⎊ Transparency in a public blockchain context means that all transactions, contract code, and network activity are openly recorded and auditable by any participant.
Unconfirmed Transactions
Transaction ⎊ The designation "Unconfirmed Transactions" primarily arises within blockchain networks, notably Bitcoin and Ethereum, representing pending transactions awaiting inclusion in a subsequent block.