How Bots Trade Around Your Crypto Buy
In this explanatory monologue, the speaker details how automated bots continuously monitor decentralized exchange (DEX) transactions and exploit users' slippage settings. When a trader submits a buy order with a specified slippage tolerance—often a percentage that allows the price to move up or down during execution—bots scan for large orders with generous slippage (e.g., $20k‑$30k with 20% tolerance). Detecting such an order, a bot will front‑run the transaction by inserting its own buy order just before the user’s, causing the price to rise. The bot then sells (or “dumps”) the purchased tokens immediately after the user’s trade, profiting from the price movement. This sequence, known as a sandwich attack, results in the original buyer receiving fewer coins or paying a higher effective price, while the attacker captures the spread. The speaker emphasizes the mechanics of slippage, bot detection, and the profit‑making loop of sandwich attacks.
