Reportedly, a Solana blockchain validator conducting sandwich attacks & so far generated $60 million, raised a very big concern about the reputation of the Solana crypto ecosystem.
Solana is a Proof-of-stake (PoS) Blockchain network that is popular for its unique protocol Proof-of-history (PoH), which allows the Solana network to process up to 70,000 transactions per second (TPS). In between 2021 to 2023, this crypto network faced significant downfall because of the bugs, which stopped the network activity for several hours multiple times.
On 10 Dec 2024, Ben, the core developer of Temporal, shared his findings related to a very big sandwich attack, in which a Solana network validator was directly involved.
Ben noted that three accounts linked to Arsc have been actively used to carry out the attacks and take profits. Arsc is a network validator for Solana, and it produces blocks and benefits via a sandwich attack bot, aiming to increase its revenue from Maximum Extractable Value (MEV) tactics.
MILLIONS of dollars in MEV are siphoned away DAILY by vpe (aka arsc), the top sandwich bot. But the worst part? This isn’t just about MEV—it’s about centralization of MEV. And it’s the greatest threat to Solana’s decentralization I’ve seen.Solana’s volume is skyrocketing, and… pic.twitter.com/v6mlSQhtg1
— Ben ⌛ (@HypoNyms) December 10, 2024
Ben proposed an idea to prepare a list to distinguish between whitelisted & blacklisted network validators; for this suggestion, Ben faced criticism.
Viktor Bunin, a Protocol specialist at Coinbase, said that such ideas may lead to censorship, centralization, and backroom deals.
Fwiw I don't think a public mempool is the nuclear option. Imo a mempool via Jito with equal mev extraction by all validators is the only reasonable option. Whitelist/blacklist just leads to censorship, centralization, and backroom deals. The way to decrease sandwiching is…
— Viktor Bunin 🛡️🇺🇸 (@ViktorBunin) December 11, 2024
Sandwich attacks can be done by only validators or those with access to private mempools. With this attack, they ensure the traders get the worst price during trading on any Defi protocol, while the attacker reaps the benefits.
Solana price action
The current trade price of Sol, the native coin of the Solana network, is $226. This price level is 6.3% and is high over the last 24-hour period.
The current trade price of $Sol coin is $227 pic.twitter.com/vIIfTZIK98
— Bitcoinik (@Bitcoinikdotcom) December 12, 2024
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