Dropping what is probably the most alpha packed thing I've written so far: an in-depth writeup of my strategy for a highly competitive MEV opportunity, the Synthetix Ether Collateral Liquidations, along with code
Blog post contains:
- My process from start the finish
- Explanation of why I made the design decisions I did
- How I sped up data collection
- A few gas optimizations
- Explanation of my economic strategy
- My novel bundle submission strategy
- Code snippets
- Many links
Repo contains:
- The only (I think?) open source example of how to backrun transactions
- Monitoring tools I made
- Contracts used for execution, including dydx flashloan
- Contract for data collection
- my somewhat embarrassing messy Hardhat testing env
This was a fun challenge because it was extremely well known opportunity (h/t: @KalebKeny for that!) where everyone had ample time to prepare. So it was bound to be really competitive. I also got to use cool knowledge I had previously tweeted about around the Flashbots auction.
In the end there was a streak of unlucky blocks and a mempool bot got the MEV 🤷🏻♂️
Anyway, I hope this helps get more people into searching
gl, hf everyone
Is the blog post enough or should I twitch stream this one too?
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Contrary to Multicoin's claims, minimizing MEV is core to Flashbots' mission & products.
That shows from our funding of fairness and ethics research, work on MEV aware dApps, & 100s of users that have used Flashbots to skip the mempool & protect themselves from frontrunning.
More importantly, Multicoin is lying about Eden: it is not permissionless OR transparent.
Eden is a permissioned system with a multisig that has exclusive control over MEV payouts to miners. The Eden team alone decides whether miners are mining "Eden blocks" and should be paid.
The beating heart of every blockchain is how space is allocated within a block.
With major changes to how Ethereum's blockspace market works in the near and medium term we'd like to share how Flashbots thinks about designing MEV marketplaces.
2nd: attest to this with a proof-of-work and propagate it to the network.
Prior to widespread MEV extraction, the 1st job was mainly ordering txs by their gas price, with optimization at the network lvl.
However, since MEV extraction is widespread now, the the job of miners has changed. Now to produce the most profitable block miners must find the optimal ordering of transactions within a block.
This is exponentially more difficult than sorting by gas price.
Fatal flaws in a bot, a sort of on-chain virus, a trojan horse token, and arbitrage gone wrong
Join me in looking at the latest MEV bot exploit in this thread 👇🏻
The victim today tried to arbitrage the CHUM token (!) for ~0.01 ETH in profit, but in the process had 30 WETH transferred out of their wallet.
They only interacted with Uniswap v2 pools, how did this happen!?
Searchers optimize their contracts to the extreme to do very specific things very efficiently.
However, occasionally they have a need to do random things & add in functions that can be used for to execute basically any arbitrary transaction in a contract
Writing this as quick as I can but I gotta figure this one out first. It's a hard one.
Looks like tomorrow or Monday I’ll put something out. Taking awhile to understand and express in a way that makes sense and I’ve got stuff to do today. Sorry folks.
🥪 frontruns a user, buying the asset they intend to and increasing the price. The user gets less tokens now.
The user's buy is then included, pushing the price up more
🥪 sells after the user's tx at the higher price, thus capturing profit
🥪 bots will watch the mempool for users trading with high slippage that they can frontrun. Until recently 🥪 bots would only do this with one trade, and with the Uniswap v2 or Sushiswap router.