TechFlow news, on August 23, market maker Jump Crypto's research team published an article proposing a new trading mechanism called Dual Flow Batch Auction (DFBA), designed to address the challenges of traditional continuous limit order books (CLOBs) on blockchains.
CLOBs rely on continuous matching and time-priority mechanisms, leading to latency arbitrage, MEV (miner extractable value) issues, and adverse liquidity for traders, thereby increasing market transaction costs.
DFBA conducts two separate auctions every 100 milliseconds, dividing orders into Maker and Taker groups and settling trades at a single fair clearing price. This mechanism eliminates time-of-arrival priority, prevents competition among liquidity providers, and shifts competitive focus from speed to price and size.
Compared to traditional designs, DFBA offers tighter spreads and deeper liquidity, while protecting natural traders from latency arbitrage and MEV reordering. Jump Crypto believes this design inherits advantages from previous trading models—such as continuous liquidity and auction fairness—while avoiding drawbacks like high slippage and fragmented liquidity, providing market participants with a fairer and more efficient trading environment.
