Draco Lab's first solution is a multi-party computation (MPC) based, self-custody wallet operator that protects against miners, validators and bundlers manipulations on transaction ordering within blocks, in particular, it protects against miner-extractable value (MEV) issues.
The MEV problem
The MEV (Miner Extractable Value) problem in blockchain refers to the ability of miners to include or exclude certain transactions in a block in order to maximize their own profit. Essentially, MEV is the amount of profit that miners can extract from a given block by exploiting various opportunities, such as front-running, back-running, or sandwich attacks.
Front-running occurs when a miner includes their own transaction in a block ahead of a user's transaction, allowing them to potentially profit from the user's trade. Back-running is the opposite, where the miner includes their transaction after the user's transaction but still profits from it. A sandwich attack is a combination of both, where a miner includes their own transaction both before and after the user's transaction.
Apart from its direct impact on blockchain’s users which can reach tens of billions of dollars per year [1], MEV has a hidden impact - causing rise in gas price, as MEV searchers compete to win an MEV by repeatedly submitting their transaction with increasing gas price.
Draco Lab’s solution
By leveraging MPC technology, our wallet ensures that user funds are insusceptible to MEV, which can be used to manipulate transactions’ order and extract additional profits from MEV searchers.
Our MPC wallet is compatible with Ethereum Virtual Machine (EVM) based blockchains, providing protection to everyone, hodlers, investors and traders.
Additionally, our wallet will be designed with user experience in mind, providing a simple and intuitive interface for users to manage their funds securely. Draco’s wallet will have all the features of traditional wallets while providing enhanced security and privacy for transactions.
Our MPC-backed wallets levarage advances in secure multi-party computation protocols to achieve both efficiency and security. We provide desktop and mobile clients, and we plan to release regular updates and new features based on feedback and contribution from our user community.
Ultimately, we turn this wallet operator infrastructure into a network that mimics the bundler functionality in the emerging account abstraction standard (EIP4337) [2], hence significantly decreasing trust users have to put in the relaying mechanisms (especially, in the open-to-all mempool management) as well as potentially decreasing gas price to everyone.
Our MPC wallet represents an innovative solution to one of the most pressing issues facing the cryptocurrency industry.
With its enhanced security and user-friendly design, we believe our MPC wallet will appeal to both institutional investors and retail traders alike, positioning Draco Lab as a leader in the market.
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