Price manipulation attacks are an indelible cancer in the current DeFi industry. #dYdX The depth of liquidity is relatively good, but they have all been deliberately attacked. It can be seen how many small pools in DeFi protocols can be easily attacked and drained of liquidity (I have seen too many such security incidents).

Unlike contract vulnerability attacks, which are guaranteed, this type of attack requires a certain amount of capital to be invested to break the price Oracle balance, and there is a certain possibility of failure. Project parties usually adjust protocol parameters and other prevention and control measures to increase the cost of implementing attacks, and use detailed risk control strategies to fine and confiscate funds. Of course, they can also resort to legal measures. Anyway, it doesn't solve the fundamental problem.

The key is that public opinion is still controversial about the nature of such attacks. Many people think that the attackers just used the AMM model and liquidity flaws to seize arbitrage opportunities. This is a speculative behavior and should not be considered a "hacker attack". This problem will remain unsolved for a long time.

Recently, we have seen a lot of exploration plans for order book trading models on L2, which have low fees, no slippage and wear and tear, and can also achieve privacy protection similar to CEX, which will attract MM market makers to migrate. However, the order book model will have thorny problems such as centralized matching, low liquidity depth, and low matching efficiency for a long time, and it is not impeccable.

Theoretically, the AMM+Order model, coupled with strict risk control strategies, such as abnormal transaction monitoring, automatic stop loss, risk reserves, etc., may be a good optimization if the two trading models are combined and can efficiently utilize the trading depth. direction.

I personally feel that as L2+L3 and other infrastructure become popular and mature, Trading will inevitably gradually move to the application market, and some independent trading chain independent trading applications will gradually emerge. On the surface, they seem to be open to the current situation. The liquidity segmentation of the protocol is actually a Tradeoff choice for pursuing security and experience in the trading environment.