An Anti-Sandwich Tool for Ethereum and BSC – With 10,000 $HKLS Airdrop Pool for Beta Users

The 2021 ETHLisbon Hackathon winner, Hackless, has been working on leveraging the overall security level in decentralized finance (DeFi).

We tasked ourselves with designing a comprehensive security platform that aims to protect the DeFi world from targeted exploits, as well as safely migrate funds from individual wallets and protocols under attack.

So far, our Conductor solution has helped to safely migrate nearly $691,000 from hacked DeFi protocols and individual wallets.

Hackless is thrilled to introduce a tool that helps fight sandwich attacks on Ethereum and Binance Smart Chain. The solution allows making safer swaps by avoiding public mempools through directly submitting transactions to miners.

DeFi Security Risks

Decentralized exchanges are widely considered more secure than centralized options because they do not store user funds, yet they come with risks that every user should be aware of.

While you hold full ownership of your funds, decentralized platforms are still prone to code risk.

This means that if the smart code has bugs or vulnerabilities, it can be exploited and funds will be lost. Unfortunately, recent statistics prove this even more. Seven of the ten largest crypto thefts that took place between January 2021 and March 2022 involved DeFi protocols.

As stated in the REKT Database, DeFi protocols have lost $6 billion in total, due to hacks and exploits of different kinds, sandwich attacks included.

Sandwich Attacks Explained

Between May 2020 and April 2022, a total of 457,691 sandwich attacks were detected with an average ROI above 4%, as calculated by a TarLogic’s report. Why such big numbers? To understand this, let’s dig a little deeper into the mechanics of sandwich attacks.

Before we go investigating, it’s important for you to understand what a mempool is in reference to DEX. In blockchain terminology, a mempool is a waiting area for transactions that haven’t been added to a block and are still unconfirmed.

These transactions are placed in a mempool that are then picked up by a miner who packages them into a block. It is also in a mempool that an exploiter can ‘look’ at transactions that are to be executed soon.

If we look closer, we can break down this strategy into a few well-seen steps, which are as follows:

• An attacker monitors the mempool to detect a high-value transaction.

• An attacker buys a certain amount of the same token before a user’s transaction is executed to pump the price.

• A user purchases the token at a higher price.