MEV Bot’s $12 million flash loan makes $20 profit.
TLDR
An MEV bot took an $11.9 million flash loan to carry out a sandwich attack. The attack targeted the user's massive loan by exchanging $5,000 worth of Shuffle (SHFL) tokens, but the bot only made $20 in profit after gas fees. The attack was completed in one block (~12 seconds). 14 transactions were the most profitable of MV bots, with one earning more than $1 million in a week.
The Maximum Extractable Value (MEV) bot recently carried out a sandwich attack using a massive $11.9 million flash loan.
The incident, reported on September 5 by blockchain analytics platform Arkham Intelligence, highlights the high potential of MEV operations and the thin margins that can sometimes result.
An MEV Bot spent $12 million in sparks for a profit of less than $20.
Sandwiched user using almost 2% slippage to exchange $5K SHFL to WETH.
The unlucky one. pic.twitter.com/I1llVBN4fH
— Arkham (@ArkhamIntel) September 5, 2024
A bot borrowed $11.97 million in Wrapped Ether (WETH) to sandwich a user trying to exchange nearly $5,000 worth of Shuffle (SHFL) tokens.
A sandwich attack involves placing two trades around a target trade to manipulate price and profit from price differences.
In this case, the MEV bot performed a total of 14 transactions, which included lending and borrowing operations of about $700,000 USD Coin (USDC) and WETH on decentralized financial protocols such as Aave and Uniswap.
The entire sequence of transactions is verified in one Ethereum block, showing that the bot completed its task in about 12 seconds.
Despite high borrowing and the complexity of the operation, Bott's profit margins were razor-thin.
After accounting for gas fees – the cost of executing transactions on the Ethereum network – the bot was left with just over $20 in profit.
This result is in stark contrast to some of the most successful MEV work in the past.
For example, in April 2023, a bot operator known as “jaredfromsubway” reportedly made more than $1 million in one week by conducting sandwich attacks against traders of popular meme tokens such as Pepe (PEPE) and Wojak (WOJAK).
The mechanics of a sandwich attack involve careful timing and execution. When a user submits a transaction to the blockchain, it first enters a waiting area called a mempool before being added to the next block.
During this window, the attacker sets up two transactions – one to ensure that the highest gas payment is made first, and another with a lower payment to be executed after the target transaction.
By buying the token at a lower price before the victim's transaction and immediately selling it at a higher price, the attacker can profit from the price difference.
However, as this latest case shows, the strategy doesn't always pay off, especially when gas bills are factored in.
Blockchain analytics firm Arkham Intelligence sheds light on this particular issue, highlighting blockchain technology's transparency and ability to track and analyze complex transaction patterns in real-time.
