Winning $1.8 million with your hands in your pocket: how your trading bot robbed the bank

The robot is worth more than gold. In the whirlwind of the crypto markets, a new drama unfolded yesterday that perfectly reflects the excitement of the last few days. This chart came to life right after a historic decision: the approval in the US of spot Bitcoin ETFs on January 10th in the US. The contagious excitement has sparked speculators and volatility in the market, including on the already expanding Solana (SOL) blockchain.

In fact, a bot specializing in transaction optimization known as Maximum Extractable Value (MEV) has performed a masterpiece. By leveraging the transaction of a memecoin – useless cryptocurrencies inspired by memes – this bot made an astonishing $1.8 million. The curtain rises on this modern tragicomedy.

It is the story of a robot, a crypto trader and a dog

First, let’s introduce the characters. An MEV bot used by an entity named 2Fast on the Solana network has converted 703 SUN is around $700,000 at the current crypto price i 19,035 SOLor almost 1.9 million dollars in just 20 seconds!

The MEV, which represents the maximum value that a participant (usually a miner or validator) can extract from a transaction by manipulating the order of transactions in a block, is therefore here impressive and very quickly got the ink flowing. This maneuver was made possible thanks to a strategy of running back, leverages a massive purchase of Dogwifhat (WIF), a dog memecoin, by a retailer. Back-running, which involves taking advantage of temporary price movements caused by another transaction. In other words, our bot converted 703 SOL to 490,000 WIF at a low price and then traded the same amount of WIF to 19,035 SOL within the same trade batch.

A cryptocurrency robot trader hits the jackpot thanks to WIF a dog memecoin

A (bot)ted crypto trader on the sidelines!

The bot used a tool developed by Jito Labswhich allows you to search for MEV opportunities and bid on transactions to be included in a package on Solana, a method similar to Flashbots on Ethereum. The initial trade, executed inefficiently in a low liquidity pool, led to the purchase of WIF at an exorbitant price of 3 dollars eachwell above its market value of 0.2 dollars. So, in addition to this comedy played by MEV-bot, let us note that behind this news is also the tragedy of a careless trader.

His misplaced order resulted in a disastrous purchase of WIF, resulting in an immediate loss of 92% of his funds. This mistake gave MEV-bot a golden opportunity to make a huge profit. One person’s misfortune makes another’s happiness.

Finally, and this will be the last word, this event reflects the complexity and risks associated with crypto trading. While the market shows some volatility at the beginning of a bull run, it is important not to forget healthy gestures and good reflexes in order to have a thoughtful trading strategy and not get kicked. It affects especially in ecosystems such as Solana, which seems to appreciate the current upward momentum and creates enthusiasm.

Leave a Comment