The Solana Foundation has announced the expulsion of a group of node operators from its delegation program due to their involvement in ‘sandwich attacks’ against users. This was reported by Tim Garcia, the head of blockchain validator relations, in a Discord channel.
I’m sure a lot of super honest people who have a perfect understanding of MEV on Solana and the Foundation Delegation program will try to misrepresent reality to feel better about their bags
For those genuinely curious, I’ll summarize:
— a sandwich attack is a malicious form of… pic.twitter.com/KhfGBgGuyT
— mert | helius | hSOL (@0xMert_) June 10, 2024
“Decisions on this matter are final. We will continue to take enforcement actions against operators involved in mempools that allow ‘sandwich attacks’,” wrote Garcia.
On May 7, a representative of the organization warned that such activities violate the ecosystem’s rules:
“The delegation program does not allow operators engaging in malicious activities, such as participating in a private mempool for ‘sandwich attacks’ or otherwise harming Solana users. Anyone caught in such activities will be expelled from the program, and the Solana Foundation’s stake will be immediately and irrevocably revoked.”
This move ensures that the foundation will not delegate authority to validators who engage in malicious activities against retail users, noted Mert Mumtaz, CEO of RPC provider Helius Labs.
He explained that a ‘sandwich attack’ is a malicious form of MEV bots that extracts all profit from certain trades, leaving ordinary traders with assets at worse prices.
According to Mumtaz, such operations were initially impossible in Solana because the blockchain client lacked a mempool. However, some validators added ‘modifications’.
“The Solana Foundation delegates SOL to validators to help them get started. Since people are abusing the system to rob retail traders and keep all the profits for themselves, the network’s foundation is not interested in this, especially using their own funds,” noted the CEO of Helius Labs.
Mumtaz also emphasized that the excluded validators will be able to continue participating in blockchain governance, but only without funding from the Solana Foundation.
Previously, the MEV bot operator jaredfromsubway.eth spent over 215 ETH (~$830,200) on fees and became the largest gas consumer in Ethereum.
Earlier, network co-founder Vitalik Buterin identified MEV as one of the three main threats to decentralization of the network, alongside liquid staking and the cost of running a full node.
The EU regulator has identified the technology as a striking example of market abuse.