Arbitrage bot’s spam attack on the Polygon network generated $6,800 per day


The growth of layer two protocols has been one of the main stories of 2021, as the growing popularity of decentralized finance (DeFi) and non-fungible tokens (NFT) has resulted in increased transaction costs on the Ethereum network ( ETH) by effectively billing many participants.

Earlier this year, the Polygon network, formerly known as MATIC, became a major competitor in the race for an efficient Layer 2 Ethereum scaling solution, and the platform The QuickSwap DeFi form of the project was also one of the most successful Uniswap clones.

The platform was quite popular initially, but as other platforms like Arbitrum and Optimism emerged, the discussions about Polygon fell apart and some traders even referred to the platform as “slow. “. Data from Flipside Crypto shows that the low-cost capabilities of the Polygon network were under attack after a cleverly designed arbitrage robot managed 14 Ether round to 218.5 Ether in less than four months.

The bot filled every block with “meaningless transactions”

According to data from Flipside Crypto, the attack began in early May and at one point in June, push transactions on the Polygon network reached 8 million per day. In the same period, the maximum number of transactions on the Ethereum network was 1.2 million.

Number of transactions on Ethereum vs. Polygon. Source: Flipside Crypto

Data found on a Polygon forum indicates that the attacker inflated transaction volumes by up to 90% by filling each block with “insane transactions” while only having to pay around 0.02 MATIC to spam the whole block and about $ 1,000 for a day.

A deeper dive into the transactions and interacting addresses on the network revealed that about 30% of the number of transactions on the network came from two contracts that were determined to be arbitrage bots that complete thousands of transactions daily to various decentralized exchanges (DEX).

The exact reason the spammer chose to fill each block when the bots were only making 2,000-4,000 transactions per day is uncertain, but one theory is that it was done in an attempt to prevent someone else to direct the transaction.

Related: Polygon May Hit $ 3.50 In Q4 As MATIC Weekly 20% Rally Triggers Bullish Flag Setup

The bot made an average daily profit of $ 6,800

Over a period of 120 days, the bot was able to grow an initial amount of 14 Ether to 218.5 Ether, which is currently worth $ 813,694.

This equates to an average daily profit of about $ 6,800 before including the cost of network spam.

In response to the spammer, the team behind Polygon ultimately decided to increase the minimum cost of a transaction from 1 gwei to 30 gwei in order to combat spam and improve network health.

The move appears to have served its purpose, as data provided by Delphi Digital shows that the rise in average transaction costs has coincided with a marked drop in the number of daily transactions, as it now costs $ 30,000 to spam the network for a period of time. whole day.

Average cost of gas in the polygon compared to the number of daily transactions. Source: Digital Delphi

Data from the network shows spam transactions fell from 2 million to 500,000 transactions per day, down 75%, but they still represent 16.7% of daily transactions. This means that the bots spend around $ 5,000 of their daily profit of $ 6,800 on gasoline to run the program.

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