Solana Validators Accused of Selling Early Access to Trades
A group of validators on the Solana network are allegedly accepting payments to leak early access to trades they receive for block production. According to an investigation, this practice is enabling quants to front-run and sandwich-attack common orders on DeFi exchanges.
The payouts start at 10 SOL ($1,000) a month, with some validators offering over 10 SOL per month to join the scheme. This valuable information allows sophisticated traders to allegedly gain an unfair advantage in the market.
Everstake, which runs one of Solana's larger validators, claims that it uses 'filtering mechanisms specifically to prevent this type of activity' and denies encouraging front-running or sandwiching. However, the investigation suggests that Everstake's traffic priority enjoys institutional 'stake-weighted quality of service,' a tier that it repackages via Blockspace.
Solana has no public mempool, unlike other blockchains, which means most transactions travel straight to the validator scheduled to build the next block without queueing in any public pool. This design was intended to minimize Maximal Extractable Value (MEV) opportunities, but instead, they've consolidated into a high society of customers who can afford to pay thousands of dollars for slices of MEV opportunities directly from validators.