An arbitrage trading bot used a $200 million instant loan to run a series of transactions, making a profit of $3.24.
This transaction was performed by an arbitrage bot that used Flashloans in order to supply the capital for its transaction.
The reason that the DAI amount is so high is due to MakerDAO’s ‘DssFlash’ contract, which allows zero-fee borrowing on any amount of DAI. pic.twitter.com/zwlM2iahAx
— Arkham (@ArkhamIntel) June 14, 2023
Analysts at Arkham Intelligence noted that the bot used the ‘DssFlash’ contract of the MakerDAO DeFi platform. The limit of attraction in DAI is limited to ~$500 million. There is no commission.
The bot then deposited assets on Aave V2, borrowing ~$2350 in WETH. Wrapped Ether was subsequently used to purchase Threshold Network (T) on the Curve platform.
After completing the arbitrage cycle, the bot sold the tokens on the Balancer DeFi platform, making a profit of 0.019 ETH (~$33). Transaction costs and block creator fees cut the net profit down to $3.24.
According to the head of the analytical company for operations, Zachary Lerangis for The Block, such bots implement any strategy, even if the financial result is insignificant.
Even though the bot had access to $200 million in DAI, it did not fully utilize the funds due to liquidity restrictions or the extent of price differentials, the specialist explained.
Recall that in March 2023, an attacker attacked Deus Finance DAO and earned about $3 million. The hack was due to manipulating the oracle, such a high profit was due to attracting an instant loan.
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