Shutter Launches First Threshold Encrypted Mempool for Ethereum-like Networks on Gnosis Chain to Combat US$900M Crypto Trading Problem
[PRESS RELEASE – Mainz, Germany, June 19th, 2024]
Shutter, an open-source protocol initially developed by brainbot and focused on preventing malicious maximal extractable value (MEV) attacks, today announced the launch of a new anti-front running solution using mempool encryption to combat the exploitation of nearly US$900 million taken from crypto trades annually. Partnering with Gnosis, the architects of the fully EVM-compatible Layer-1 Gnosis Chain, Shutter will be integrated into the Gnosis Chain to protect end-user transactions from front running and sandwich attacks, shielding traders from malicious MEV activities that can result in significant monetary loss and unfair influence.
Setting a New Standard for MEV Protection with Deep Chain Integration
MEV attacks are transactions by attackers that manipulate the outcome of the target transaction within a blockchain that maximizes financial gain for malicious actors at the expense of traders and end-users. Common malicious MEV activities include sandwich attacks, where an attacker places their transactions both before and after a victim’s transaction. This manipulates the token price to the attacker’s advantage, typically driving up the price of the token for the victim.
Despite the growing incidences of such attacks, existing solutions to this problem often fall short of holistically addressing the complexities of MEV attacks. Many traders still remain unaware that they are victims of exploitation until significant losses are incurred. Even once they are made aware, victims have to take extra steps to protect themselves, often relying on centralized systems that can still censor and extract value.
To address this gap, Shutter provides malicious MEV protection and a layer of censorship resistance via the threshold encrypted mempool built into the Gnosis Chain. Distinguishing itself from existing methods of tackling MEV attacks, Shutter integrates its encryption protocol directly into blockchain networks, preventing manipulators from exploiting transactions. This deep integration means block producers must commit to the inclusion and order of transactions while they are still encrypted, making it almost impossible to front run or censor. This also ensures that traders are protected from monetary losses without needing additional measures.
Tackling Unchecked Spread of Malicious MEV Attacks with Decentralized Encryption for Fair Trading
Shutter’s unique approach is exceptionally critical in today’s maturing Web3 landscape where hundreds of millions of dollars are stolen each year on Ethereum alone through MEV tactics. These attacks exploit the public nature of blockchains and remain largely unchecked, consequently reducing market efficiency, diminishing trust in the system, and making it fundamentally unfair.
Shutter’s encrypted mempool also mitigates real-time censorship, ensuring transactions remain private until included in a block. This prevents malicious actors from selectively excluding transactions, reinforcing the core principles of public blockchains—openness, neutrality, and accessibility. By increasing information symmetry through Shutter’s encryption approach, the playing field is leveled. At the same time, the integrity of public blockchains is preserved, providing greater confidence for retail and large institutional investors typically deterred by rampant front running in decentralized finance (DeFi) to enter the space, attracting a broader range of participants in the long run.
A Strategic Integration
Gnosis Chain’s integration of Shutter directly tackles the rampant issue of malicious MEV through preventive measures as opposed to many other blockchains that continue to struggle to resolve such growing issues, marking a significant milestone for not just the Shutter community, but the industry at large. Charting towards the shared vision of a more equitable blockchain ecosystem, Gnosis Chain’s relentless focus on decentralization and accessibility harmonizes with Shutter’s efforts to address contemporary industry challenges impeding the adoption of Web3. Ultimately, Shutter will play a vital role in encouraging safer crypto trades, increasing censorship resistance, and preventing value leakage.
A Vision for the Future
This integration is one of many in the pipeline for Shutter that helps build momentum toward combating malicious MEV attacks across the Ethereum ecosystem. Collectively, Shutter and its partners will shield the users from manipulation, ensuring equitable access and maintaining a neutral base layer.
Luis Bezzenberger, Product Manager at brainbot said: “We’re incredibly excited to unveil a protocol that can solve one of the most rampant issues in today’s decentralized finance landscape. Gnosis Chain is home to one of the most vibrant communities in Web3 and by joining forces, we can strengthen the Web3 ecosystem and provide Gnosis Chain’s users with a seamless, fair and more profitable trading experience.”
Philippe Schommers, Head of Infrastructure at Gnosis said: “We’re thrilled to join Shutter’s mission of building a Web3 ecosystem that is transparent, equal, and secure for all. Integrating Shutter, we believe we are empowered to provide the best user experience for our developers and builders and we are dedicated to continuing demonstrating our sustained ecosystem growth through robust integrations and partnerships with promising protocols, dApps, and projects.”
Martin Köppelmann, Co-Founder of Gnosis said: “Security and fairness remain at the core of everything we do. The integration with Shutter not only bolsters our network resilience and neutrality but will also set an industry gold standard for fortifying safeguards against third-party value extraction from network users, leveling the playing field for the future of Web3 and decentralized finance.”
Shutter will be launched on July 11, 2024 on the final day of the Ethereum Community Conference (EthCC), the largest annual European Ethereum event focused on technology and community.
About Shutter
Shutter is a free open-source software designed to protect the crypto community from those manipulating the blockchain for their own gain. Using threshold encryption, Shutter ensures base layer neutrality, information symmetry, and accessibility in trading, voting, and gaming.
About brainbot
brainbot GmbH specializes in the development, distribution, licensing, and operation of software, alongside providing a wide range of related services. As the core developer behind Shutter, brainbot plays a pivotal role in advancing blockchain technology.
About Gnosis
Gnosis is developed by a world-class team of leading forces in blockchain and payments. The Gnosis Chain is architected with community ownership, resilience, and credible neutrality at its core. The highly decentralized network is secured by 200K+ validators and 2K+ nodes, across 70 countries and 5 continents.
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