On-chain order books and app-chains

Junior · enrolled learners

This lesson opens with The account that stopped a market, 14 September 2021.

What happened

During Grape Protocol's token launch on Raydium's AcceleRaytor platform, bots flooded Solana with transactions, and some validators were receiving over 300,000 a second. One of those bots structured its transactions to write-lock eighteen key accounts, among them the global SPL token program and the Serum decentralized exchange program. Because a transaction touching a write-locked account cannot execute in parallel with another touching the same account, this severely reduced the parallel execution the chain relies on, and the network was left processing transactions sequentially. Queues grew without limit, leaders failed to include the vote transactions consensus depends on, block producers proposed competing forks, and the chain was down for roughly seventeen hours until validators coordinated a restart from the last confirmed slot.

The decision point

The property that makes an on-chain order book auditable is that its state lives in accounts anybody can read. That same property makes it contendable, because an order book is a small number of accounts and anybody willing to spend transactions can hold them. So the venue's practical throughput is bounded by contention on its own state rather than by the chain's advertised capacity, and on a shared chain that contention is created by activity which has nothing to do with the venue.

Orientation and Year One are open: anyone can read them without an account. From Year Two onward the lessons are for enrolled learners, because progress through the later years only means anything if it is tracked against a record.

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