Sealed Bid Auction
🔒 Sealed Bid Auction
The Sealed Bid Auction (commit–reveal model) ensures privacy and fairness in competitive bidding scenarios.
How it works: The auction occurs in two phases:
Commit Phase – Bidders submit cryptographically hashed bids, hiding the actual bid amount from competitors.
Reveal Phase – After the commit window closes, bidders reveal their bids to prove validity. The highest revealed bid wins the auction.
Benefits:
Prevents front-running and bid sniping, since no one knows the actual bids during the commit phase.
Encourages participants to bid their true valuation rather than just slightly above competitors.
Creates a more level playing field for buyers, especially in high-demand auctions.
Use case: Ideal for scenarios where bidder privacy and fairness are critical, such as exclusive or highly contested domains where transparency might otherwise lead to manipulation.
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