In the decentralized finance (DeFi) ecosystem, in a world where sophisticated bots and algorithms exploit market inefficiencies, even the most advanced strategies can sometimes lead to disappointment. On September 5, a Maximum Extractable Value (MEV) bot operator made a mere $20 profit after borrowing around $12 million worth of Wrapped Ether (WETH).
A Failed Exploitation Attempt
Blockchain analytics platform Arkham Intelligence detailed in a post on X that the bot performed a “sandwich” attack to manipulate a token swap. The strategy involved detecting a pending transaction. In this case, a user swapped around $5,000 worth of Shuffle (SHFL) tokens, and the bot executed two trades around the transaction. First, it increased the token price before the user traded, then immediately sold it, attempting to profit from the price difference. A Prize Pool Worth 21 Million TL Awaits You from BinanceTR! Participating and winning has never been easier.. You can sign up to BinanceTR from this link. Get your first crypto!
For this attack, the MEV bot borrowed $11.97 million via a flash loan and attempted to manipulate a token swap in the hopes of making a quick profit. However, the transaction did not go in the bot’s favor.
After borrowing money, the bot executed 14 separate transactions as part of the sandwich attack, borrowing and repaying approximately $700,000 worth of USDC stablecoins and WETH through two DeFi protocols, Aave and Uniswap.
Jaredfromsubway.eth Returns With Advanced Tactics
Etherscan data showed that the entire transaction was confirmed in a single block, meaning the MEV bot processed 14 transactions in about 12 seconds. Despite the complexity of the transaction, the unlucky MEV bot operator managed to secure a single transaction with Ethereum (ETH) $2,349.89 After paying their fees, he only made a profit of $20.
The incident comes at a time when MEV bots are gaining traction in the crypto space, with cybercriminals increasingly using them to make quick and big profits from market inefficiencies.
Recently, a MEV bot known by the alias jaredfromsubway.eth has resurfaced with improved techniques. According to EigenPhi, this famous bot, which rose to prominence early last year and then disappeared, has now returned with more advanced capabilities.
The increasing prevalence of these bots has caught the attention of law enforcement. In May, prosecutors in the United States charged two brothers with allegedly stealing nearly $25 million in a new scheme targeting crypto trading bots on the Ethereum blockchain. Anton Peraire-Bueno, 24, and James Pepaire-Bueno, 28, currently face charges of conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering.
MEV bots sometimes fail to achieve the desired results when attempting to exploit market inefficiencies in the decentralized finance ecosystem. In this case, the bot operator borrowed a large amount of money but was only able to make a small profit. Advanced bot techniques and market manipulations have attracted the attention of law enforcement and can pose significant risks to DeFi users and investors. How MEV bots will evolve in the future and how to prevent such incidents will continue to be an important topic for financial regulators and technology developers.
Disclaimer: The information contained in this article does not contain investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
