A mysterious entity on the Ethereum (ETH) blockchain has been observed pocketing tens of millions of dollars in profits with a clever technique known as sandwich attacks.
The Ethereum address, tagged as jaredfromsubway.eth, has made more than $34.3 million in the past three months using a sandwich attack strategy, according to analysts at the chain.
Sandwich attacks are when an entity detects a large pending transaction on a blockchain, then executes the transaction, typically offering more gas fees to gain higher priority in the queue. The initial execution pushes the price up, forcing the victim to buy at a higher price than anticipated and allowing the culprit to sell at a higher price immediately afterward.
According to a report by blockchain data analytics firm EigenPhi, jaredfromsubway implemented the strategy on February 27 and has since raised $40.6 million in revenue for a staggering profit of $34.35 million.
EigenPhi found that the jaredfromsubway bot was detected in more than 60% of all Ethereum blocks in the week of April 17. The firm says that the entity occasionally engaged in simple arbitrage strategies as well, but spent most of its time buying and selling tokens in its sandwich attacks. .
“We looked at how this bot gained a lot of attention recently and outperformed other sandwich and arbitrage bots. One of the key strategies is to use a lot of altcoins.
The bot’s account contains a significantly higher number of tokens compared to the second-ranked sandwich bot.
This gives the bot a considerable advantage in terms of finding sandwich opportunities. The more tokens a bot has, the more opportunities it has to execute sandwich transactions. At the highest point, Jared’s bot contains over 800 different types of tokens.”
According to EigenPhi, the bot did not make significant profits until April 17, when altcoin trading volume increased sharply.
Etherscan data shows that the jaredfromsubway.eth address has made a staggering 414,966 recorded transactions as of this writing.
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Featured Image: Shutterstock/Jorm S
