On Wednesday, an arbitrage bot took advantage of a flash loan opportunity by borrowing $200 million worth of the Dai stablecoin (DAI) from MakerDAO. After factoring in transaction fees, the bot successfully generated a profit of $3.24
According to the crypto data provider Arkham Intelligence, the bot capitalized on markerDAO’s “DassFlash” contract, which enables users to borrow DAI without being charged any fees.
In this case, the bot utilized a flash loan, which is a loan received and repaid within a signal block without requiring any initial collateral. It borrowed 200 million DAI tokens and provided them to the Aave DAI market, using them as Collateral to borrow $2,300 worth of wrapped ether (WETH).
The acquired WETH was utilized to purchase Threshold Network (T) On Curve, followed by a series of single-block transactions where it was subsequently sold on Balancer.
After deducting transaction and protocol fees, the overall profit before fees amounted to $33. However, these fees amounted to nearly $30, resulting in a net profit of $3.24.
Its worth noting that flash loans have been associated with malicious activities in the past. Instances of flash loan exploit on decentralized finance (DeFi) platforms like Platypus and 0VIX have resulted in substantial losses surpassing $10 million.
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