Original title: Crypto trader gets sandwich attacked in stablecoin swap, loses $ 215K
Original article by Brayden Lindrea, Cointelegraph Author
Original translation: ChatGPT
Editor's note: This article reports a sandwich attack on a cryptocurrency exchange, where a trader lost more than $215,000 when exchanging stablecoins. The article describes the attack in detail, including how the MEV robot profited through front-end transactions, and explores possible money laundering. At the same time, the article also mentions the protection measures taken by the Uniswap platform to prevent such attacks and clarifies the initial criticism.
The following is the original content (for easier reading and understanding, the original content has been reorganized):
On March 12, a crypto trader fell victim to a sandwich attack while transferring $220,764 in stablecoins, losing almost 98% of its value, or $215,000, which was captured by MEV bots.
$220,764 worth of USDC stablecoins were exchanged for $5,271 of Tether USDT in 8 seconds, as the MEV bot successfully front-loaded the trade, making a profit of more than $215,500.
Data from the Ethereum block browser showed that the MEV attack occurred in the USDC-USDT liquidity pool of the decentralized exchange Uniswap v3, which locked assets worth $19.8 million.
Details of the sandwich attack transaction source: Etherscan
According to Michael Nadeau, founder of The DeFi Report, the MEV bot front-loaded the trade by swapping all USDC liquidity out of Uniswap v3’s USDC-USDT pool and then putting it back after the trade was executed.
Nadeau said the attacker paid a $200,000 tip to the Ethereum block builder "bob-the-builder.eth" from the $220,764 transaction and made $8,000 for himself.
DeFi researcher “DeFiac” speculated that the same trader using different wallets may have suffered a total of six sandwich attacks, citing “internal tools” as evidence. They pointed out that all funds came from the lending protocol Aave before being deposited in Uniswap.
Two of the wallets fell victim to the MEV robot sandwich attack at around 9 am UTC on March 12. Ethereum wallet addresses "0xDDe...42a6D" and "0x999...1D215" were sandwiched in transactions three to four minutes ago, losing $138,838 and $128,003 respectively.
These two traders performed the same swaps in Uniswap v3’s liquidity pool as the trader who made the $220,762 transfer.
Some speculate that the transactions may be related to money laundering.
“If you have NK illicit funds, you can construct a transaction that is very vulnerable to MEV attack, send it privately to a MEV bot, and have them arbitrage in a bundle,” said 0xngmi, founder of crypto data dashboard DefiLlama. “This way you can launder all the money with close to zero loss.”
While Nadeau initially criticized Uniswap, he later admitted that the trades did not originate from Uniswap’s front end, which has MEV protection and default slippage settings.
Nadeau walked back those criticisms after Uniswap CEO Hayden Adams and others clarified the protections Uniswap had in place to prevent sandwich attacks.
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