Safety Features

Preventive Measures against Miner Extractable Value (MEV) and Front-running

  • All orders on Moby are placed in an on-chain queue and executed in order, ensuring the highest level of fairness for all traders

  • At execution, the calculation of pricing and risk premiums considers both the Greeks profile of OLPs as well as external market data such as futures and implied volatility

  • This approach effectively prevents the prediction of profits through exploitative strategies such as Miner Extractable Value (MEV) and front-running

Risk Hedging Mechanism for Liquidity Providers

  • Moby's Dynamic Risk Premium model incentivizes or applies additional charges to traders based on how their positions influence Moby OLPs’ Greeks risk

  • The Dynamic Risk Premium thus effectively steers traders to consistently open positions in favor of retaining a Greeks-neutral state for Moby’s OLPs

  • Even in a theoretically extreme situation where traders largely take positions that could adversely affect Moby's OLP Greeks risk, the Dynamic Risk Premium model responds by significantly raising spreads to discourage such trades and prevent OLPs’ risk exposure

Preventive Measures for Risk Caused by Inaccurate Data Feed

  • To ensure the accuracy of pricing and risk management, real-time data is gathered from multiple sources, including major CEXs and a mix of on / off-chain oracles such as Block Scholes, 1inch, and Chainlink to mitigate systematic error

  • Should there still be any error in the data despite such precaution, Moby’s trade execution layer halts operation and thereby prevents the execution of erroneous transactions

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