Is XRPL Giving Insiders an Edge? Ripple CTO Responds

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XRPL-focused commentator XRPresso reignited concerns over front-running risks on the network, prompting a response from Ripple CTO David Schwartz, who acknowledged the possibility but also argued that incentives and transparency already in place limit abuse.

There’s another debate about whether XRPL has a meaningful front-running/sandwich attack problem and whether ordinary users are at a disadvantage. MEV-like behavior, front-running, and sandwich attacks on XRPL AMMs aren’t a new thing. They’ve been discussed for years, especially since the team behind it introduced the AMM functionality.

Therefore, Schwartz and XRPresso are discussing how exploitable and profitable the existing behavior is in practice, not if the mechanism can theoretically exist.

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What XRPresso says

According to the commentator, validators and sophisticated traders can see pending transactions before ledger closure. They can analyze a pending trade fast to see if front-running or sandwiching it is profitable.

At the same time, submitting multiple transactions increases the chances of getting a favorable slot because the final ordering within each ledger is based on a known formula. This is very beneficial for these actors.

The issue allows them to potentially insert trades ahead of users to profit from slippage, overall creating an uneven playing field, especially for XRPL’s DEX and AMM users.

While, based on XRPL documentation, the order of transactions is designed to be unpredictable, the commentator argues this is not enough to protect against front-running. “The mechanism can still be exploited, especially by those with faster or privileged visibility into pending transactions,” he writes.

XRPresso argues that this hurts adoption and should be addressed to protect the “participants who simply want to trade without being systematically disadvantaged.”

What Schwartz says

Schwartz replied directly, a move that suggests he found the claims significant enough, even if he disagreed with the severity as presented by XRPresso.

“This is true, but is mitigated by a number of factors,” the CTO said. Yes, the mechanism exists in theory, but he claims it’s heavily mitigated.

Validators don’t get a special advantage unless they collude, and any validator manipulation would be publicly visible, then quickly punished by the network, Schwartz argued.

Additionally, there is little evidence that this is happening in practice beyond proof-of-concept demonstrations.

He proposed a possible future fix: transaction reservations, allowing users to reserve execution priority for a fee, requiring them to submit two transactions for each one running in this manner. “This guarantees that you can execute your transaction ahead of any transaction that was formed after your transaction was disclosed,” Schwartz said.

The debate is ongoing, as more users have feedback to share.