This week, an anonymous MEV (Miner Extractable Value) bot operator earned over $1 million by executing “sandwich attacks” on buyers and sellers of two new meme coins.
According to a tweet posted by the NFT data platform Sealaunch on April 19, the wallet address associated with this activity is linked to the Ethereum Name Service (ENS) domain “jaredfromsubway.eth.” The operator made $950,000 in profits from a sandwich attack on April 18, and around $300,000 and $400,000 on April 17 and 19, respectively.
The ENS domain name of the bot is likely a playful jab at the famous sandwich chain and its infamous former spokesperson, Jared Fogle.
In another post, Sealaunch explained that, between April 18 and 19, MEV bots consumed 7% of all Ethereum gas fees during that 24-hour period.
Cryptocurrency researcher Matt Willemsen explained that a significant portion of these profits came from attacks on trading activity involving two new meme coins: Pepe (PEPE) and Wojak (WOJAK), which led jaredfromsubway.eth to become one of the largest gas consumers on Ethereum over the past day and week.
How Sandwich Attacks Work
A sandwich attack involves the attacker “sandwiching” the victim’s transaction between two of their own transactions in order to manipulate the price and extract profits. This is possible because the victim’s transaction is initially sent to the mempool, waiting to be included in the next block. Meanwhile, the attacker sets a transaction with a higher gas fee to ensure it is processed first, followed by another transaction with a lower gas fee to ensure it is processed after the victim’s.
The attacker profits by buying the victim’s tokens at a price lower than the market value and then selling them within the same block, pocketing the difference between the transaction income and gas fees.
According to data shared by Thomas Mattimore, head of Reserve Protocol, the massive profits for “jaredfromsubway.eth” came from spending nearly $1.2 million in gas fees between April 18 and 19.
Sealaunch also reported that MEV bot operators spent over $7 million in gas fees across 180,000 transactions.
MEV Bots: A Hot Topic of Debate
While some find the MEV bot’s domain name and activities amusing, not everyone is pleased. An analyst from on-chain analytics firm Glassnode questioned the “value” of the work that “jaredfromsubway.eth” provided to the broader Ethereum network.
Other Twitter users have gone further, expressing their frustration and anger towards MEV bot operators for their perceived negative impact on regular users.
According to MEV Blocker, MEV bots have extracted over $1.38 billion from Ethereum users trying to trade, provide liquidity, and mint NFTs.
In response to the growing concerns, several MEV-blocking projects have been launched in recent months to help protect Ethereum users from sandwich attacks and similar tactics.