MEV Sandwich Attacks: The Invisible Tax on Every Trade

On 12 March 2025, someone swapped $220,764 of USDC for USDT on Uniswap, the largest automated exchange on Ethereum. Both are digital dollars, tokens that each stand for one US dollar, so the trade should have returned close to $220,000. It returned $5,271. More than $215,000 was gone in a single block, the batch of transactions Ethereum confirms every 12 seconds or so. Nobody hacked the trader. A trading robot saw the order coming and stood on either side of it.

That is a sandwich attack, and it is the best-known form of MEV, short for "maximal extractable value": the money that can be made by choosing which transactions go into a block, and in what order. On a stock exchange, a broker who sees a big client order and trades ahead of it is front-running, and it is illegal. On a public blockchain it happens tens of thousands of times a month, and in most cases nobody is breaking any law.

How a sandwich is made

Ethereum transactions do not go straight into the record. They wait in a public queue, the mempool, where anyone can read them before they are confirmed. Since 2022, blocks have been assembled by specialist firms called block builders, who take orders from all comers and are paid in tips to put transactions in a chosen order.

A sandwich bot reads the queue looking for large swaps. Uniswap does not use a broker or an order book; each market is a pool of two tokens, and the price moves automatically as one side is bought out. When the bot finds a big order, it buys first, pushing the price up. The victim's order then fills at the worse price. The bot sells straight after, at the higher price the victim created. The victim is the filling; the bot's two trades are the bread.

The only protection is a setting called slippage: the worst price a trader will accept. Set it at half a per cent and a sandwich bot has almost nothing to take. Set it at zero, meaning "any price", and the bot can take nearly everything.

The $215,000 morning

The March 2025 victim had sent the order straight to Uniswap's underlying code, skipping the company's app, which sets a price limit automatically. The order carried no limit at all.

The analytics firm EigenPhi pieced together what happened next. A bot it labelled 6B40 borrowed about 1.1 million USDC from Aave, a crypto lending market, putting up 701 wrapped ether as collateral. It then swapped about 18.65 million USDC for USDT across a Curve pool and the Uniswap pool, buying up almost all the USDT in the price range the victim was trading in. The victim's 220,764 USDC then bought just 5,271 USDT. The bot sold back, repaid the loan, and kept about $8,700.

Most of the money went elsewhere. The bot paid a tip of 100.6 ETH, then about $200,000, to the block builder bob-the-builder.eth, which built the block. EigenPhi found that bot and builder worked together. Michael Nadeau of the newsletter The DeFi Report was one of the first to draw attention to the trade.

It was not one trade. EigenPhi counted six USDC-to-USDT swaps sandwiched in five minutes, apparently from the same person using several wallets, for total losses of about $714,000; two of them alone lost $138,838 and $128,003. The next day the same trader set a proper limit and swapped about $1 million without trouble. The pattern was strange enough that 0xngmi, the pseudonymous founder of the data site DefiLlama, suggested publicly that it might be money laundering: a deliberately bad trade sent to a friendly bot. That theory was never confirmed.

The size of the tax

Sandwiches are mostly small and constant. EigenPhi data analysed by Cointelegraph Research counted more than 95,000 attacks on Ethereum between November 2024 and October 2025, costing traders about $60 million a year. Monthly extraction fell from nearly $10 million in late 2024 to about $2.5 million by October 2025, even as monthly trading on decentralised exchanges rose above $100 billion. The average sandwich made its operator just over $3 after costs; builders took most of the rest through tips.

One operator dominates. About 70 per cent of Ethereum sandwiches are linked to a bot known as jaredfromsubway.eth, which has taken out about 117,000 ETH since March 2023, according to figures reported by Mars Finance. On Solana, a faster rival blockchain, sandwich bots took between $370 million and $500 million over 16 months, according to research by the tracker sandwiched.me presented at Solana's Accelerate conference in 2025.

Robbing the robbers

Bots that read everyone else's orders can be fooled by orders written for them. In June 2026, jaredfromsubway.eth itself was drained of at least $7.5 million. The attacker built fake trading pools and 131 bait tokens dressed up as WETH, USDC and USDT, according to CertiK. The first trade paid the bot a small profit, so it granted the bait contracts permission to spend its tokens. The bait was then changed so those permissions were never used up, and once enough had piled up, a "tripwire" contract emptied the bot. Blockaid called it a counter-MEV honeypot. Part of the money went to Tornado Cash, a service that mixes deposits so they cannot be traced.

A similar trick is now the subject of the first criminal case over MEV. In May 2024, US prosecutors in Manhattan charged two brothers who studied at the Massachusetts Institute of Technology, Anton and James Peraire-Bueno, with taking about $25 million from sandwich bots in 12 seconds in April 2023 by baiting them with lure transactions. The brothers deny wrongdoing. Their trial ended in a mistrial in November 2025 when the jury could not agree. At a hearing in March 2026, Judge Jessica Clarke said she would rule on their bid to have the charges dismissed before setting a retrial, which would not start before November 2026.

Defences exist, and they work. Services such as Flashbots Protect and MEV Blocker send orders privately to builders instead of the public queue; exchanges such as CoW Swap match orders in batches at one price, which leaves no gap to stand in. They are not the default everywhere, and a trader who goes straight to the code, as the March 2025 victim did, gets none of them.