The Problem Scenario
Imagine Alex, a DeFi trader, attempting to do a straightforward $10,000 USDC to ETH swap on a well-known DEX. When Alex hits "confirm," their transaction is added to the mempool, which is a place where MEV bots hunt. A very advanced sandwich bot recognizes Alex's trade and reacts in milliseconds:
The Attack Unfolds:
The bot places a massive buy order right before Alex's transaction
This artificially inflates the ETH price
Alex's swap executes at the inflated price, receiving fewer ETH tokens
The bot immediately sells, profiting from the price difference
It should have been a simple trade, but Alex loses $200 to $500, while the MEV bot makes money. This is a hidden fee on regular users that can cost traders two to five percent on each transaction, and it occurs millions of times every day across Ethereum, Arbitrum, Base, and other chains.
Most traders are exposed to this predatory behavior because traditional solutions need customers to manually opt into complicated protection programs.
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