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

Exchange aggregator 1inch released a new tool called “Rabbithole” on November 25, which the company says will protect traders against malicious “breadcrumbs” attacks. The team announced the launch of the tool in a press release that was provided to Cointelegraph.

Rabbithole works by allowing users to send transactions directly to nodes, bypassing the mempool. To use it, users need to change the remote procedure call (RPC (NYSE:)) endpoint in their crypto wallet. Then each swap initiated through 1inch will be analyzed by its own tx routing algorithm developed by the 1inch team and then sent directly to validators if there is a chance of an attack sandwich style.

1. The attacker scans the blockchain’s mempool until a high value transaction is found
2. A transaction is sent to run before the victim’s purchase and higher gas is paid to ensure that the attacker’s transaction is processed before the victim. This early transaction inflates 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 sends a second transaction selling their coins, pocketing the difference in price.