Curve Exploit Results in Largest MEV Block Rewards in Ethereum’s History

Curve Exploit Results in Largest MEV Block Rewards in Ethereum’s History

Time Stamp: July 31, 2023 12:16 AM
Source Node: 2794824

MEV bots front running exploiters on Curve pools generated some of the largest reward blocks ever seen on Ethereum.

Photo by Choong Deng Xiang on Unsplash

Posted July 31, 2023 at 12:16 am EST.

Ethereum core developer Eric Connor revealed that a Maximal Extractable Value (MEV) bot received 584 ETH, worth over $1 million, from front running an incoming hack in the transaction mempool.

Several other significant MEV block rewards were recorded around the same time, with the recipients earning 345 ETH, 247 ETH and 51 ETH. The rewards stem from front running transaction sent by exploits that took place on Curve Finance’s liquidity pools on Sunday.

Notably, these MEV rewards are the largest recorded in the history of Ethereum, incidentally falling on the network’s eighth official year in existence.   

In order to earn these rewards, MEV bots reproduce and front run transaction by paying the block producers a significant amount of ETH to move their transaction up to the front of the line.

“They’re paying money that was stolen from victims as kickback bribes to Ethereum validators,” wrote one user on Twitter. 

While several market participants questioned the morality of block producers keeping these rewards that came from hacked funds, Connor opined that returning the funds is likely more complex than it appears on the surface, while noting it is “probably a legal grey area.”

Meanwhile, at least one MEV bot deployer has returned funds after front running a hacker’s transaction. Blockchain data shows that “c0ffeebabe.eth” returned 2,879 ETH worth $5.3 million to the Curve deployer contract.

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