Most blockchain innovations are always exploited. In Silk Road, Bitcoin was exploited for illegal trades. Flash-loans and Sandwich Attacks are also exploits of wonderful innovations.
Ethereum Improvement Proposal(EIP-1559) was proposed to help users speed up their transactions. If one is in a tight corner and needs to get their transaction processed faster, they increase the gas fee and the transaction gets faster attention. But this has been exploited through front-running.
Does this mean that this innovation should be stifled?
FTX exploited the innovation of using centralized exchanges (CEXs) in blockchain. Does that mean CEXs should be abolished?
In all these, the advantages of these innovations cannot be denied. Just like this research paper attempts to propose solutions, one of the ways to solve these issues should through more and better innovations.
Today users are talking about Proof of Reserve (PoR) for Centralized Exchanges. That’s an innovation to solve CEXs transparency issues through Zero-knowledge-proofs.
Because an innovation was exploited shouldn’t be a reason to sweep it under the carpet. More and better innovative ways should be used to solve these problems.