What Is the Primary Difference in Front-Running Mitigation between Centralized (CEX) and Decentralized (DEX) Exchanges?
CEXs prevent front-running through centralized control, regulatory compliance, and internal trade surveillance systems. They manage the order book and transaction execution sequence privately, making traditional front-running by external actors impossible.
DEXs, however, operate on public blockchains where pending transactions are visible in the mempool. Mitigation on DEXs is therefore technical and protocol-based, involving solutions like private transaction pools, transaction batching, and fair sequencing to counteract the transparency of the public ledger.
The core difference is centralized governance versus decentralized protocol design.