Originally published on: September 06, 2024
A recent mishap in the world of decentralized finance saw an unfortunate maximum extractable value (MEV) bot taking out a massive $12 million loan, only to end up making a mere $20 in profit from its endeavors.
The incident, as reported by blockchain analytics platform Arkham Intelligence on Sept. 5, involved the MEV bot securing an $11.97 million loan in Wrapped Ether (WETH) to execute a complex “sandwich” attack against a user looking to swap Shuffle (SHFL) tokens worth around $5,000.
According to Arkham’s findings, the bot engaged in a total of 14 transactions, involving lending, borrowing, and exchanging approximately $700,000 in USD Coin (USDC) and WETH loans across DeFi platforms like Aave and Uniswap.
Despite the intricate nature of the attack and the significant loan amount, the MEV bot’s profit margin was disappointingly low, with earnings amounting to just a little over $20 after factoring in gas fees.
The swift execution of the attack, completed within a single block and over a span of approximately 12 seconds according to Etherscan data, highlighted the bot’s agility in maneuvering transactions for its gains.
Sandwich attacks, like the one orchestrated by the MEV bot, involve manipulating transaction prices by strategically positioning transactions around a victim’s trade. By exploiting the delay between a user’s transaction and its confirmation in the block, attackers can capitalize on price differentials to turn a profit.
While this particular MEV bot may have fallen short in terms of profits, others have seen considerable success in the past. Notably, the operator known as “jaredfromsubway” raked in over $1 million in a week through sandwich attacks on Pepe (PEPE) and Wojak (WOJAK) memecoins.
Despite the risks and occasional setbacks, the world of MEV bots continues to intrigue and captivate with its high-stakes maneuvers and potential for substantial gains.
