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Infrastructure Security
Last updated: August 2025

Arbitrage Infrastructure Security Hardening Blueprint

Arbitrage trading infrastructure handles hot keys, latency‑sensitive execution, multi‑exchange API auth, and high‑value collateral flows. Compromise means unauthorized withdrawals, strategy leakage, or manipulated execution parameters. This 2025 hardening blueprint delivers a defense‑in‑depth model: threat surface mapping, key management (HSM / MPC), network segmentation, runtime isolation, software supply chain controls, continuous monitoring, and an actionable execution checklist.

Threat Surface & Attack Vectors

API Key Theft

Unencrypted keys on disk or environment variables leaked via logs / crash dumps.

Credential Phishing / Social

Panel / bastion access hijacked leading to lateral movement.

Dependency Supply Chain

Malicious PyPI / npm typosquats injecting data exfiltration logic.

Container Escape

Privilege escalation from trading bot container to host network / secret volumes.

Key & Secret Management Architecture

1

HSM / MPC Signing

Hot keys restricted; signing done via network attached HSM or MPC node threshold; raw private key never touches application memory.

2

Secrets Vault

Dynamic short‑lived credentials; access brokered by Vault with policy namespacing & sealed at rest (Shamir unseal keys).

3

Just-In-Time API Tokens

Exchange sub‑accounts rotated programmatically; revoke blast radius limited to narrow margin & withdrawal scopes.

4

Outbound Policy Filtering

Egress restrictions; signing service only allowed to target whitelisted RPC / exchange endpoints.

Network Segmentation & Host Hardening

Tiered Zones

Execution tier (bots) isolated from control / signing tier via firewall allowlist & mTLS.

Immutable Images

Golden AMI / container base hashed & SBOM stored; drift detection alerts on unauthorized packages.

Kernel Hardening

Enable Seccomp, AppArmor/SELinux profiles, disable unused modules, restrict ptrace, enforce ASLR / NX.

Runtime Isolation & Sandboxing

  1. Ephemeral Containers: Stateless builds redeployed per commit; no mutable local state.
  2. Read-Only Root FS: Force explicit writable volumes; reduces tampering persistence.
  3. Non-Root Execution: Drop capabilities (NET_ADMIN, SYS_PTRACE); principle of least privilege enforced at runtime.
  4. Sidecar Policy Agents: Enforce outbound domain / method allowlists for API calls.
  5. WASM / VM Sandboxes (Optional): Strategy logic executed in constrained runtime before signing step.

Software Supply Chain & Dependency Security

Pinned & Signed Artifacts

Use hashes / Sigstore attestations; reject mutable latest tags.

SBOM Generation

CycloneDX / SPDX produced at build; scan against CVE feed diff.

Typosquat Detection

Automated allowlist diff of new package names with Levenshtein distance threshold.

Observability, Detection & Anomaly Signals

Centralize logs (structured JSON) for: auth events, signing requests (hash only), withdrawal intents, API rate limit anomalies, strategy parameter diffs. Derive metrics: abnormal burst ratio, failed auth slope, latency degradation percentile correlating potential compromise or resource exhaustion.

Access Control & Zero Trust Principles

Short-Lived Credentials

mTLS certs rotated daily; SSH disabled in favor of SSM session recording.

Policy as Code

OPA / Rego rules in repo; pull‑request reviewed; prevents drift & shadow access.

Risk-Based MFA

Adaptive step‑up for sensitive operations (withdraw limit raise, policy change).

Patch, Vulnerability & Configuration Management

  1. 1. Automated CVE Ingestion: Feed merges into ticket queue with severity scoring mapped to SLA.
  2. 2. Canary Stage: Roll patch to low priority replica; measure latency & error budget impact.
  3. 3. Config Drift Detection: Periodic hash of critical files vs baseline; alert on mismatch.
  4. 4. Cryptographic Agility: Track deprecation (e.g. SHA‑1) across code / infra artifacts.

Incident Response & Recovery Playbooks

Compromised Key Runbook

Immediate revoke sub‑accounts, freeze withdrawal address set, rotate HSM slot.

Container Escape Suspect

Quarantine node; export forensic snapshot; redeploy from clean immutable image.

Anomalous Trading Surge

Rate limit escalation, disable new strategies, enforce stricter slippage caps.

Security Hardening Execution Checklist

  1. Secrets Vaulted: No plaintext API keys / private keys on disk.
  2. Signing Isolated: App never handles raw private key; HSM / MPC enforced.
  3. Immutable Build: Base image digest pinned & SBOM stored.
  4. Runtime Non-Root: Capabilities trimmed; seccomp profile loaded.
  5. Network Policy Applied: Pod / instance egress restricted to approved endpoints.
  6. Logging Structured: Centralized ingestion with anomaly rules deployed.
  7. Patch SLA Met: High severity CVEs < 7 days; medium < 30 days.
  8. IR Playbooks Tested: Tabletop exercise completed last 90 days.

Tools, Frameworks & Automation Stack

  • HashiCorp Vault (dynamic secrets)
  • Sigstore / Cosign (artifact signing)
  • Falco (runtime syscall detection)
  • Trivy / Grype (image & SBOM scanning)
  • Prometheus + Loki + Grafana (metrics & logs)
  • OPA / Gatekeeper (policy enforcement)
  • Elastic / OpenSearch (search & anomaly queries)
  • PagerDuty / Slack (response orchestration)

Build a Resilient Arbitrage Stack

Combine infrastructure hardening with MEV sandwich defense, finality risk monitoring and regulatory risk controls for holistic operational security.

Conclusion

Security for arbitrage infrastructure is iterative: each control (vault, segmentation, sandboxing, scanning, monitoring) compounds to shrink attacker dwell time and transaction exploit surface. Treat secrets and signing as product features, enforce measurable SLAs for patching and incident response, and continuously replay threat scenarios to validate resilience. Defense becomes a competitive latency asset when engineered deliberately.

Tags

Infrastructure Security Key Management Runtime Isolation Supply Chain Security Zero Trust Incident Response

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