A naive strategy is a simplistic approach to market participation or protocol interaction that does not account for complex market dynamics or adversarial behavior. Such a strategy typically involves straightforward actions without advanced analytical consideration or adaptive adjustments. It often leads to suboptimal outcomes.
Context
In cryptocurrency trading or decentralized finance (DeFi), users employing a naive strategy might fall victim to Maximal Extractable Value (MEV) extraction or experience significant slippage on trades. Understanding the limitations of naive approaches highlights the importance of sophisticated algorithms and informed decision-making in competitive digital asset environments. Many protocols aim to protect users from these vulnerabilities.
A game-theoretic model formalizes MEV-Boost auctions, demonstrating how latency and strategic bidding, not maximal value, drive block selection, quantifying auction inefficiency.
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