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The MEV (Maximal Extracted Value) phenomenon has a huge and diverse impact on the DeFi market. The technological features of the blockchain operation and decentralized trading mechanisms allow manipulations with transactions of ordinary users that lead to the minimization of their potential profit during the exchange.
MEV is especially easy to achieve when performing complex cross-chain exchanges on aggregators that automate them. During the initiation of the exchange, the entire planned route is published to the public. Additionally, sufficiently large slippage values are set to increase the chances of a successful exchange. All this leads to the maximum insecurity of cross-chain payments made through aggregators and their potential unprofitability.
Kinetex Aggregation has taken a set of measures aimed at significantly reducing the influencing factor of MEV attacks. The main methods are discussed below.
All transactions in Kinetex Aggregation go through relay nodes, making it possible to manage their publication in the mempool. The networks most affected by MEVs, mainly Ethereum, often resort to using private mining capabilities. So, at the moment, Kinetex publishes transactions through the infrastructure of the Flashbots organization, thus helping to avoid the disclosure of transaction details before they appear in the mined blocks and therefore exclude their analysis by MEV search engines.
In the future, as Kinetex transitions to its own network of nodes, the development team will continue to use every opportunity to reduce the impact of MEV attacks on our users' transactions.
All exchanges in Kinetex Aggregation are based on a signed user message that includes details of transactions in each of the route's networks. This message has the format of a Swap structure, which contains an array of SwapStep structures and is incorporated in the SwapParams structure. The SwapStep structure has a chainID field, so each step is applied separately to each network. When this message is published to the public, it becomes possible to carry out MEV attacks, foreseeing the entire exchange route in advance.
In order to reduce this risk, the contract was upgraded using the SwapStealth structure. When using it, only the user-signed set of hashes of each SwapStep structure is published with the first transaction, and the data of each step itself is published directly during the exchange. These measures are designed to complicate the extraction of MEV and therefore reduce its risk significantly.