The server next to the hub would need to cost the same as the entire value of the arbitrage market for that to work.
The next server could be free, for all that it is worth - Arbitrage opportunities can be exploited in their entirety by the first player.
This wouldn't address the problem of front-running across exchanges either.
A possible panacea would be a transaction tax, whether that is measured in dollars or in time.
@NotThamesWater started
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The server next to the hub would need to cost the same as the entire value of the arbitrage market for that to work.
The next server could be free, for all that it is worth - Arbitrage opportunities can be exploited in their entirety by the first player.
This wouldn't address the problem of front-running across exchanges either.
A possible panacea would be a transaction tax, whether that is measured in dollars or in time.