Ethereum Suffers Significant Loss in Sandwich Attack
Ethereum, the second-largest blockchain network, has experienced a major setback due to a sandwich attack, resulting in a loss of over $9,000. This incident highlights a growing problem of sandwich attacks in the crypto industry, with more than $1.3 million lost through such schemes on the Ethereum chain in the past month.
The Sandwich Attack Explained
On October 9th, the Ethereum network fell victim to a significant sandwich attack by the MEV bot (0x00…6B40), which generated a profit of approximately $4,060 after factoring in costs, according to data from Eigenphi. MEV bots are known for extracting miner-extractable value in blockchain transactions.
An analysis of network data revealed that this attack occurred shortly after the Ethereum Foundation attempted to sell 1.7K Ethereum tokens through Uniswap V3. The foundation intended to exchange these tokens for 2.738 million USDC via Uniswap.
The attacker exploited a series of transactions involving multiple tokens, such as WETH, USDC, ETH, aUSDC, aWETH, and variable WETH. As a result, the MEV bot earned approximately 5.616 ETH in revenue during these transactions, ultimately securing profits of 3.111 ETH after deducting costs.
At the time of the attack, Ethereum was trading between $1,600 and $1,618. This means that the MEV bot made revenue of around $9,101 and actual profits of $4,060. Consequently, the Ethereum Foundation suffered a loss of $9,101.
Despite this setback, the foundation still holds significant assets totaling $3.687 million, including 240.68 ETH, 3.238 million USDC, 49,700 DAI, and 10,000 ARB.
The Sandwich Problem Extends Beyond Ethereum
Further analysis by Eigenphi reveals a significant increase in sandwich attacks. In the 24 hours prior to the report, 85 attackers profited a total of $22.9K. Over the past seven days, there have been approximately 20.4K victims and 123 attackers who accumulated profits of $239.4K. In the last month alone, sandwich attacks have resulted in minimum profits of $1.38 million.
While Ethereum remains the primary target, BSC chains have also seen a rise in attacks, with attackers earning $497.4K in the past month.
These recent incidents serve as a reminder of the substantial risks associated with the blockchain ecosystem, which can affect anyone involved.
Hot Take: The Growing Threat of Sandwich Attacks
The prevalence of sandwich attacks in the crypto industry is becoming increasingly alarming. These attacks not only pose a significant risk to individual users but also impact major blockchain networks like Ethereum. As demonstrated by recent incidents, attackers are exploiting vulnerabilities to extract profits from transactions, resulting in substantial losses for victims.
To protect yourself from sandwich attacks and similar schemes, it is crucial to exercise caution when engaging in blockchain transactions. Stay updated on the latest security measures and be mindful of any suspicious activity or irregularities during your transactions. By remaining vigilant and informed, you can mitigate the risks associated with these types of attacks.
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