A Solomonic Solution to Ownership Disputes: An Application to Blockchain Front-Running

20 Pages Posted: 21 Feb 2022 Last revised: 15 May 2023

See all articles by Joshua Gans

Joshua Gans

University of Toronto - Rotman School of Management

Richard Holden

University of New South Wales (UNSW)

Date Written: February 2022

Abstract

Blockchain front-running involves multiple agents, other than the legitimate agent, claiming a payment from performing a contract. It arises because of the public nature of blockchain transactions and potential network congestion. This paper notes that disputes over payments are similar to classic ownership disputes (such as King Solomon's dilemma). We propose a simultaneous report mechanism that resolves Solomon's dilemma (using only ordinal preference information) and also eliminates blockchain front-running. In each case, the mechanism relies on threats to remove ownership from all claimants and preferences from the legitimate claimant over allocations to other agents.

Suggested Citation

Gans, Joshua and Holden, Richard, A Solomonic Solution to Ownership Disputes: An Application to Blockchain Front-Running (February 2022). NBER Working Paper No. w29780, Available at SSRN: https://ssrn.com/abstract=4039499

Joshua Gans (Contact Author)

University of Toronto - Rotman School of Management ( email )

105 St. George Street
Toronto, Ontario M5S 3E6 M5S1S4
Canada

Richard Holden

University of New South Wales (UNSW) ( email )

Kensington
High St
Sydney, NSW 2052
Australia

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
8
Abstract Views
246
PlumX Metrics