KEY TAKEAWAYS
- FAIR introduces a Layer 1 blockchain designed to eliminate MEV, using the BITE Protocol to encrypt transaction data and prevent exploitation.
- FAIR’s EVM is optimized for AI agents and high-frequency applications, offering near real-time execution with enhanced privacy and MEV resistance.
- Integration with the SKALE ecosystem allows FAIR to provide MEV-free markets and lower operational costs, with a dual-token economy involving SKL and FAIR tokens.
AI agents are increasingly executing trades, managing capital, and routing liquidity on blockchain networks. However, the infrastructure supporting these activities, which is also used by decentralized finance (DeFi) users, is facing significant challenges. Transactions are often exposed, leading to leaked strategies and exploitation by Maximum Extractable Value (MEV) bots and insiders. This has resulted in a hidden transaction tax for users.
MEV, or Maximal Extractable Value, allows bad actors to reorder, censor, and front-run transactions, extracting billions from both protocols and everyday users. On platforms like Ethereum, over 70% of blocks include MEV, and as AI agents and stablecoins drive DeFi adoption, the impact of MEV is expected to grow. Addressing MEV is becoming increasingly crucial as it is projected to become a $100 billion issue.
FAIR: A New Layer 1 Blockchain to Combat MEV
FAIR is introduced as the first Layer 1 blockchain designed to eliminate MEV at the consensus level. It utilizes the Blockchain Integrated Threshold Encryption (BITE) Protocol, which encrypts transaction data before broadcasting it to the network. This ensures that validators cannot read or reorder transactions, preventing front-running and sandwich attacks.
The FAIR blockchain integrates a high-performance Ethereum Virtual Machine (EVM) engineered in C++ to support AI agents and high-frequency financial applications. Unlike traditional EVMs, FAIR’s EVM is optimized for parallel execution and asynchronous processing, offering near real-time execution without sacrificing determinism or composability.
FAIR’s integration with BITE Protocol ensures that smart contracts can execute without exposing strategies or decisions, providing a level of MEV resistance and privacy not found in other virtual machines.
FAIR and SKALE Ecosystem Synergy
FAIR is closely integrated with the SKALE ecosystem, aiming to enhance value capture and reduce reliance on other Layer 1 chains. SKALE chains will upgrade to the FAIR SDK, gaining access to encrypted execution and zero-MEV guarantees. This integration is expected to lower operational costs and provide seamless access to deep, MEV-free markets.
FAIR introduces a dual-token economy, with SKL tokens burned to operate FAIR validator nodes and unlock advanced features, while FAIR serves as the native token. A portion of FAIR’s token supply will be airdropped to SKL holders, contingent on governance voting and the successful launch of the FAIR mainnet.
The FAIR testnet is preparing for launch, with support from Vodafone to secure the network. The integration roadmap with SKALE will unfold in phases, with details on tokenomics and community incentives to be announced.
For more information, visit the official announcement here.
Why This Matters: Impact, Industry Trends & Expert Insights
The introduction of the FAIR blockchain aims to address the significant issue of Maximum Extractable Value (MEV) in DeFi and AI transactions by using innovative encryption methods to protect transaction integrity.
Recent industry reports indicate that MEV mitigation and protocol design improvements are crucial trends in addressing MEV challenges. FAIR’s use of the Blockchain Integrated Threshold Encryption (BITE) Protocol aligns with these efforts to enhance transaction security and minimize risks associated with transaction ordering.
As per insights from a Coin Bureau report, the market impact of MEV solutions is significant, particularly in ecosystems like Ethereum, where MEV exploits are prevalent. This supports the potential impact of FAIR’s approach in providing a more secure and efficient environment for DeFi and AI transactions.
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