1inch releases new tool to protect traders against ‘sandwich attacks’

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Exchange aggre­ga­tor 1inch released a new tool called “Rab­bit­hole” on Nov. 25, which the com­pa­ny says will pro­tect traders against mali­cious “sand­wich attacks.” The team announced the launch of the tool in a press release that has been made avail­able to Cointelegraph.

Rab­bit­hole works by allow­ing users to sub­mit trans­ac­tions direct­ly to Ethereum nodes, bypass­ing the mem­pool. In order to use it, users need to change the remote pro­ce­dure call (RPC) end­point in their cryp­to wal­let. After that, each swap ini­ti­at­ed via 1inch will be ana­lyzed by the pri­vate tx rout­ing algo­rithm devel­oped by the 1inch team and then sent to val­ida­tors direct­ly if there is a pos­si­bil­i­ty of a sand­wich attack.

Accord­ing to the press release, a “sand­wich attack” is a type of cryp­to font-run­ning that con­sists of three steps:

  1. The attack­er scans the blockchain’s mem­pool until it finds a high-val­ue transaction
  2. A trans­ac­tion is sub­mit­ted to front-run the victim’s pur­chase, and high­er gas is paid to make sure that the attacker’s trans­ac­tion gets processed before the victim’s. This ear­ly trans­ac­tion pumps the price of the coin that is about to be pur­chased, caus­ing the vic­tim to pay more
  3. After the victim’s trans­ac­tion is processed, the attack­er sub­mits a sec­ond trans­ac­tion that sells their coins, pock­et­ing the dif­fer­ence in price

This type of attack is so named because it “sand­wich­es” the victim’s trans­ac­tion between two trans­ac­tions sub­mit­ted by the attacker.

Accord­ing to a report by Tar­Log­ic, titled, “Track­ing Ethereum blockchain cryp­to attack­ers: Mea­sur­ing sand­wich attacks,” over 60,000 Ether (ETH) was lost from sand­wich attacks from May 2020 to April 2022 — a val­ue of over $72,000,000 at the time of publication.

The cryp­to R&D team, Flash­bots, had pre­vi­ous­ly released a python library that allowed users to sub­mit trans­ac­tions direct­ly to nodes. How­ev­er, this library could only be used in a devel­op­er envi­ron­ment. Accord­ing to 1inch, Rab­bit­hole is a library that works sim­i­lar­ly to Flash­bots, but it also includes a con­sumer-friend­ly fron­tend for users.

Rab­bit­hole is the lat­est in a string of upgrades to the 1inch decen­tral­ized exchange (DEX) aggre­ga­tor. In August 2021, the team launched an Ethereum lay­er 2 ver­sion on Opti­mism and in Novem­ber 2021, a new main­net router to opti­mize gas costs was implemented.

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