On Valentine’s Day, popular NFT trading platform Blur generously airdropped its governance token with the ticker symbol $BLUR to reward its players. The value of the token skyrocketed to $5 after the airdrop, but crashed drastically to $0.6 within an hour. This sudden and significant price drop made $BLUR a lucrative opportunity for traders, arbitrageurs, and sandwich makers alike.
Given the potential gains, it’s no wonder $BLUR has caught the attention of savvy and adventurous traders. Within 24 hours of the airdrop, $BLUR quickly rose to become the fourth most popular token on the DeFi market, with over $49 million in total trading volume. By rough estimate, $BLUR’s trading volume for MEV transactions reached $118 million in just two days.
The extreme volatility of the token made liquidity pools the best places for MEV to exchange $BLUR. Consequently, a $BLUR/$WETH pool on Uniswap was the 5th hottest liquidity pool with over $30 million in trading volume. You can See this LP for more transactions.
Arbitrageurs snapped up profits from LPs like bloodthirsty sharks, while the top trades were almost exclusively arbitrage trades.
Let’s take a look at how a MEV seeker was able to make over $36,000 in profit on a single atomic arbitrage trade. You can check out the details of this incredible trade Here、.
First, the searcher found that an EOA account, 0x345, bought $BLUR with 50,000 $USDC (Step 3). They then sent 0.4432 $ETH as a builder reward to the arbitrage bot to initiate the transaction (Step 0). The bot completed the arbitrage by exploiting the price difference between two orders. On the one hand, 50,000 $USDC could be exchanged for 45,454 $BLUR in the order of 0x345 in the mempool. On the other hand, you could use just 12,915 $USDC to buy the same amount of $BLUR from another Uniswap V3 liquidity pool.
After paying the builder’s premium, the seeker made a profit of $USDC 37,084.6. It is amazing to see the potential profits that can be made from a well-executed arbitrage trade.
It’s important to be on the lookout for potential dangers that may be lurking in the background even when the focus is on immediate gains. Unfortunately, Sandwich Attackers have found their way into the mix, chasing wins and dominating the win ranking with their 🥪 Attacks for the next few hours.
If we look at the win rankings, we can see that almost all victims of these sandwich attacks are NFT holders, which is not surprising. Hereinafter Sandwich attack transactionthe attacker was able to make a profit of $3,305.2; by trading 28,922 $BLUR for 9.4 $WETH in the Uni V3 pool to increase the price of $WETH. Hence the victim @mondogggwho is the co-creator of @alphadoggg_, received less $WETH than expected. Similar situations happened with another NFT holder @0xcari.
In this Valentine’s Day attack, however The victim lost over $11,000 in just three transactions. This leading NFT holder @garrettedvf became the main target of the sandwich attack.
The implementation of the BLUR token can certainly boost platform activity. However, NFT players venturing into the DeFi space must take the risk of MEV seriously. As we have stated in the report of The Tokenomic Trilemma: A Theoretical Framework for Anticipating and Diagnosing the Shortcomings and Risks of DeFi Protocols: “On the one hand, unlike bitcoin and ether, it is becoming increasingly difficult to capture value for native tokens issued independently of new protocols. The aggregate value of these native blue-chip tokens, based on a specific innovative consensus, is “limited in size,” which has led to high price volatility. In addition, the process of liquidity change represents the process of entropy increase and there is a window of time before stability is restored.
You can check if you are the one that was exploited by the sandwich attack our websites. Find the latest MEV opportunities from the winning list and live streaming of MEV transactions with $BLUR.
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