You’re going off about econ 101 but do not recognise the term market failure [1]?
> Fair auctions naturally attract more buyers and sellers than unfair auctions
Citation needed. (Plenty of examples of open-bid ascending-price auctions beating better systems due to familiarity, for instance.)
More fundamentally, auctions are subject to network effects. They benefit from anchor participants, i.e. repeat participants of substantial size. Those anchors tend to want perks for participating. The entire domain of market microstructure and ECNs rebating market makers is a story of broad participants’ desires for a fair system competing with narrow participants’ desires for a biased one. This effect is exacerbated when one side of the market is repeat or big while the other is ephemeral or small.