An infamous “sandwich” bot was exploited for $7.7 million in a hack dripping with irony. Jaredfromsubway.eth is a maximal extractable value (MEV) bot that specializes in sandwich attacks, in which an attacker sees a trade waiting to be executed and makes the same buy directly before the trade and sells immediately after it. The way it works is that the sandwiched trade raises the price of the cryptocurrency being bought, letting the bot sell at a profit. For example, if a buyer sets a $100 trade, it will jack the price up to $101. So the automated sandwich bot buys directly in front of the original trade, which now pays…
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Sandwich Attacks: Are You on the Menu?
Explanation of “front running” risks in crypto and how to avoid them
Traditional “front running” is trading of stocks or other financial assets using privileged information about an upcoming transaction that is anticipated to significantly impact its price. For example, brokers could front run trades by using insider knowledge regarding their firm’s imminent issuance of a buy or sell recommendation to clients, a move expected to influence the asset’s price. Trading on this kind of non-public information is illegal in most jurisdictions, not only because it’s unfair to other market participants but also because it degrades the integrity of financial markets and erodes investor trust. In the often “Wild West” of crypto markets, given that all too often lawmakers haven’t caught up…
