Crypto trader loses over $215,000 in a sandwich attack on Uniswap; risks of decentralized exchanges highlighted.

From Cointelegraph

March 12, 2025 8:54:32 PM:

A crypto trader lost almost 98% of a $220,764 stablecoin transfer to an MEV bot in a sandwich attack on March 12. The attacker managed to swap USD Coin for Tether in eight seconds, pocketing over $215,500. The MEV attack occurred on Uniswap v3’s USDC-USDT liquidity pool.

The MEV bot front-ran the transaction on Uniswap v3, taking out USDC liquidity before swapping it back in. The attacker tipped an Ethereum block builder $200,000 and profited $8,000. The same trader has reportedly fallen victim to six sandwich attacks using different wallets.

Two wallets were sandwich attacked for $138,838 and $128,003 on March 12 at 9:00 am UTC. Both transactions involved the same swap in the Uniswap v3 liquidity pool. Some speculate the trades could be attempts at money laundering.

There are suspicions that the transactions may be related to money laundering. Founder of crypto data dashboard DefiLlama, 0xngmi, suggested a method to wash illicit funds with minimal losses. Uniswap initially faced criticism but later clarified its MEV protection and default slippage settings.

DeFi researcher DeFiac pointed out that the attacked wallets received funds from Aave before depositing them on Uniswap. Uniswap CEO Hayden Adams and others clarified the protections in place to combat sandwich attacks. The incident highlights the risks associated with decentralized exchanges.

Read more at Cointelegraph: Crypto trader gets sandwich attacked in stablecoin swap, loses $215K