Crypto.news - The Ethereum network recently witnessed some of the highest Maximal Extractable Value (MEV) reward blocks in history, following a vulnerability on the Curve Finance platform.
This event significantly rewarded MEV bots that front-ran transactions during the defi crisis, leading to an unprecedented rise in MEV incentives.
Ethereum (ETH) core developer “eric.eth” disclosed in a tweet on July 31 that the MEV rewards that day were amongst the largest in the blockchain’s history.
This came on the heels of a significant vulnerability detected and exploited on July 30, enhancing the MEV opportunities for Curve Finance’s stable pools.
Following the turmoil, developers across the ecosystem initiated a whitehat rescue operation to secure the endangered funds. However, hackers managed to thwart two of these planned operations mere minutes before they could be executed.
What are the MEV bots?
MEV bots, by rearranging or inserting transactions into regular blocks, create arbitrage opportunities for increased profits. These bots can also foresee liquidation transactions and acquire assets at a discount by preemptively purchasing them.
Sometimes MEV bots incentivize validators with large amounts of ETH to prioritize their transactions. This tactic provides an edge for the MEV bots in the mempool, enabling them to process their transactions before others.
Record MEV rewards
Of note was one block with an MEV reward of 584.05 ETH, valued at over $1 million, which was among the highest in Ethereum’s history. In addition, there were three more significant MEV rewards during this period, totaling 345 ETH, 247 ETH, and 51 ETH.
These substantial rewards, however, sparked ethical debates within the crypto community. Critics argue that MEV bots may gain unfair transaction advantages by compensating validators with potentially illicit payments. Some have even suggested that retaining these rewards would be unethical if sourced from stolen funds.
Despite the seemingly straightforward process of returning the funds, potential legal complications could arise, adding a layer of controversy to the subject.
Despite the seeming ease of returning the monies, the procedure may include legal complications, making the subject controversial.
This article was originally published on Crypto.news
