A DLC (Discreet Log Contract) is only as fair as its randomness source. If you're using a Bitcoin block hash as your oracle input for anything with money on it, you've got a miner front-running problem that won't care how tight the rest of your contract is.
This ain't theoretical. PancakeSwap lost $1.8M in 2021 to an attack that precomputed the block hash used as a random seed (SWC-120). DeFi, but the same class of attack applies to any protocol where the person producing the "randomness" can see the downstream payoff first.
Block hashes are predictable to miners.
Why block hashes fail for DLCs specifically
Here's the attack in plain terms:
