A crypto trader lost almost all $220,764 due to an attack by an MEV bot. The incident occurred on the decentralized exchange Uniswap and sparked discussions in the community.
What Happened to the Crypto Trader?
On March 12, the trader lost 98% of $220,764 in a stablecoin swap. An MEV bot employed a 'sandwich attack' strategy, front-running a transaction worth over $215,500 to exchange USD Coin for $5,271 worth of Tether.
Analysis of the MEV Attack on Uniswap
According to the Ethereum block explorer, the attack occurred in the USDC-USDT liquidity pool on Uniswap v3, where $19.8 million is locked up. The bot removed all USDC liquidity from the pool and returned it after the transaction. Of the $220,764, $200,000 was tipped to the block builder bob-the-builder.eth, and $8,000 was the attackers' profit. DeFi researcher 'DeFiac' suggests that the same trader suffered six such attacks, related to the Aave and Uniswap protocols.
Could This Be Money Laundering?
Some experts speculate that the operations might be used for money laundering. Founder of DefiLlama, 0xngmi, stated: 'If you have illicit funds, you could make a very MEV-able transaction and send it to a bot that arbitrages the funds with minimal losses.' Founder of The DeFi Report, Michael Nadeau, initially criticized Uniswap but later noted that the attack did not occur through Uniswap's MEV-protected interface.
This news serves as a serious warning for crypto traders about the necessity to carefully check MEV and slippage settings before making large trades. Even experienced traders can be vulnerable to such attacks.
