The on-chain arbitrage market is a hyper-competitive arena. Finding opportunities is only half the battle, executing on them is where things get challenging.

On public blockchains, simple observation allows competitive or predatory traders and bots to extract the value of discovered arbitrage — reducing the amount of time to capitalize on the market inefficiency or pricing disconnect. Until now.

Today, we are proud to announce that Bancor’s Arb Fast Lane has integrated COTI’s Garbled Circuits, marking a major milestone in on-chain privacy that’s set to level the playing field for arbitrage traders.

What is Arb Fast Lane?

The Arb Fast Lane is Bancor’s onchain arbitrage trading bot and execution system.

It continuously monitors markets, searching for price discrepancies across all major decentralized exchanges. When it identifies an opportunity, it computes a sequence of trades, designed to capture that discrepancy, known as arbitrage.

The route is executed step by step, and if the final result does not meet predefined thresholds, the transaction reverts.

The Arb Fast Lane ensure high-quality arbitrage opportunities are discovered, executed efficiently, and done so privately — protecting the arbitrage opportunities for traders across the market as they discover them.

The Arbitrage Transparency Problem.

While the logic is sound, the transparency of public blockchains creates a structural problem for traders looking to take advantage of arbitrage. On public blockchains, transactions are visible before they execute. As soon as a transaction enters the que, profitability thresholds are broadcast to the network where competing bots can observe and copy them.

In this environment, blockchain transparency exposes strategy. But Bancor’s Arb Fast Lane solves this.

The COTI Solution: Selective Encryption

By leveraging COTI’s Garbled Circuits, the Arb Fast Lane can now encrypt sensitive execution inputs at the protocol level. Traders don’t need to hide the entire transaction; it’s about intentional privacy.

  • Encrypted thresholds: The sensitive value is encrypted before broadcast.

  • On-chain enforcement: The smart contract still enforces the threshold during execution and reverts if it isn’t met.

  • Zero visibility: The value is never exposed in plaintext to the competing bots or broader network.

This shift moves the competition back to where it belongs: discovery and execution efficiency, rather than simple observation-based extraction.

The Future of Arbitrage

With the integration of COTI’s Garbled Circuits into the Arb Fast Lane, Bancor is introducing a meaningful upgrade to onchain arbitrage execution: privacy applied intentionally, at the exact point where transparency becomes a liability.

By protecting arbitrage opportunities while enabling broader market participation, we aren’t just helping one trader or bot, we are building a fairer, more mature on-chain market.

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