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Crypto Bot Makes $1M+ With "Sandwich Attacks" on Meme Coins

Key Takeaways
  • An anonymous bot operator used "sandwich attacks" to earn over $1 million from two meme coins
  • The attacker bought below-market-value tokens, then sold them for profit
  • Projects like MEV Blocker have been launched to protect Ethereum users from sandwich attacks, which have taken over $1.38 billion from traders, liquidity providers, and NFT minters
20-Apr-2023 By: Shikha Jha
Crypto Bot Makes $1M

Anonymous bot operator earns $1M through "sandwich attacks" on meme coins using the Ethereum blockchain

An anonymous bot operator has reportedly profited over $1 million this week by using a tactic called "sandwich attacks" on two new meme coins. The operator's Ethereum Name Service domain, "jaredfromsubway.eth," made $950,000 on April 18 alone, with additional profits of $300,000 and $400,000 on April 17 and 19, respectively, according to NFT data platform Sealaunch.

In a sandwich attack, the attacker places their own two transactions around a victim's transaction, manipulating the price and taking advantage of the user. The victim's transaction is forwarded to the mempool, where it waits to be included in the next block. 

The attacker then creates two transactions, one with a high petrol fee to ensure it is accepted first and another with a low petrol fee to ensure it is accepted second so that both are accepted simultaneously. The attacker buys the victim's token at a price below market value, then sells it within the same block to pocket the difference between the transaction's income and petrol costs.

MEV Bot operator earns over $1M with Sandwich Attacks, and MEV Blocker protects Ethereum users from sandwich attacks.

The MEV bot's profits were mostly derived from nearly $1.2 million spent on gas fees between April 18 and 19, according to Thomas Mattimore, head of a platform at the Reserve Protocol. The bot operator has reportedly spent over $7 million on petrol expenses across 180,000 transactions, as per Sealaunch.

While some Twitter users found humor in the bot's domain name and actions, others expressed their frustration towards the MEV bot operator. On-chain analytics company Glassnode even questioned the value of jaredfromsubway.eth's work.

As a response, projects such as MEV Blocker have been launched to protect Ethereum users from sandwich attacks. The MEV bots have reportedly extracted over $1.38 billion from Ethereum users attempting to trade, provide liquidity, and mint NFTs, as per MEV Blocker. 

Also, read - Elon Musk Threatens Legal Action Against Microsoft for Training AI on Twitter’s Data

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