What Surveillance Tools Are Used by CEXs to Detect Internal Front-Running?

CEXs use sophisticated trade surveillance systems that employ algorithms and machine learning to monitor trading patterns in real-time. These tools look for suspicious correlations between employee trades and large client orders, sudden changes in trading volume or price, and anomalous execution sequences.

They also monitor communication records and access logs to ensure that employees with access to the private order book are not trading the same assets just before a market-moving event.