Jump Crypto has introduced a new trading mechanism, Dual Flow Batch Auction (DFBA), to tackle the limitations of traditional continuous limit order books (CLOBs) on the blockchain. The DFBA model, unveiled by Jump Crypto's research team, aims to mitigate issues like latency arbitrage and miner extractable value (MEV) that increase transaction costs and affect liquidity.
The DFBA mechanism operates by conducting two independent auctions every 100 milliseconds, categorizing orders into Makers and Takers, and executing trades at a single fair clearing price. This approach eliminates the need for arrival time priority, reducing competition among liquidity providers and shifting the focus to price and scale. Jump Crypto asserts that DFBA offers tighter quotes and deeper liquidity, protecting traders from latency arbitrage and MEV reordering, while maintaining continuous liquidity and auction fairness.
Jump Crypto Proposes DFBA Mechanism to Enhance Blockchain Trading
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