Automated MEV extraction system on Ethereum and EVM-compatible blockchains
About The Project
We set out to build an end-to-end MEV extraction system capable of identifying and executing profitable on-chain opportunities, primarily DEX arbitrage, loan liquidations, and NFT sniping, across Ethereum and other EVM-compatible chains. The system combined off-chain opportunity detection logic with on-chain smart contract execution, using private transaction relays (Flashbots) to avoid frontrunning and eliminate failed-transaction gas costs. Over several months of active research and development, the project surfaced critical real-world constraints around latency, liquidity, and competitive saturation that shaped a clear strategic conclusion.
System Architecture
System Architecture diagram
Key Challenges
Detection latency exceeded block time
One iteration of the arbitrage detection loop took 6–7 seconds using Infura and Alchemy far too slow for Ethereum's ~12-second blocks, and completely unworkable for faster chains with 1-second block times.
Mempool access required costly infrastructure
Reacting to unconfirmed transactions essential for frontrunning and sandwich attacks required running a full Ethereum node and a custom indexer, representing significant capital and DevOps investment.
Uniswap v3 pricing was unreliable at scale
Prices on Uniswap v3 depend on liquidity concentrated within tick ranges, making exact price calculation for a given quantity impossible without multiple sequential on-chain calls, infeasible within time constraints.
Profit margins were eroded by fees
Detected arbitrage opportunities on Uniswap v2 and SushiSwap were largely cancelled out when accounting for gas fees (post-EIP-1559), swap fees (0.3%), and flash loan fees leaving margins at or below zero.
Alternative chains posed capital and tooling barriers
Validator staking requirements on chains like Fantom (550k FTM) and Avalanche (2000 AVAX) made mempool access prohibitively expensive. Tooling equivalents to Blocknative and The Graph were also unavailable or immature
CEX-DEX arbitrage lacked viable liquidity
Opportunities existed between centralised exchanges and DEX pools, but almost exclusively in low-cap tokens with insufficient depth, making it impossible to offset transfer fees and gas costs at any meaningful trade size.
Our Solution
Flashbots relay for zero-cost, private submissions
All transaction submissions were routed through the Flashbots MEV relay, eliminating gas fees on failed transactions and protecting our bundles from frontrunning by other searchers or miners.
Flash loans for zero-capital execution
Smart contracts were designed to borrow capital via Uniswap flashswaps within a single atomic transaction executing multi-hop arbitrage trades, repaying the loan, and reverting automatically if profit did not exceed gas cost.
Forward-playing via mempool monitoring
Using Blocknative, the system monitored pending transactions with high slippage to anticipate arbitrage windows in the next block, buying time to run heuristic opportunity detection ahead of confirmation.
Mainnet forking for gas-free experimentation
Hardhat's mainnet fork capability was used to simulate real on-chain conditions enabling smart contract testing and multi-hop transaction validation against live state without incurring gas costs.
Multi-hop arbitrage to reduce competition
Exploiting combinatorial complexity, we focused on multi-hop paths across pools that existing single-hop bots were unlikely to scan, reducing head-to-head competition and increasing the chance of exclusive discovery.
NFT minting bot as a lower-competition vertical
An Avalanche-based NFT minting bot was built and successfully tested on testnet, designed to mint as soon as a contract was unpaused, targeting launch windows where competition was lower and timing was the key edge.
The Result
Working infrastructure delivered
Built a complete end-to-end pipeline: real-time LP monitoring, multi-hop transaction execution via smart contracts, Flashbots bundle submission, and a Hardhat mainnet fork environment, all production-ready components.
Market saturation mapped with precision
Confirmed through empirical testing that Ethereum arbitrage and liquidation verticals are dominated by established bots with full-node infrastructure, providing a clear data-backed rationale for strategic pivot.
NFT sniping validated as a viable opportunity
Successfully deployed and tested an NFT minting bot on Avalanche testnet, with live trials planned on Avax Lions and FTM Frogs, the only tested MEV vertical with a viable competitive window.
Reusable MEV framework established
Code developed for arbitrage execution, flash loan contracts, multi-hop routing, and relay submission logic, forms a reusable foundation for rapidly deploying bots against newly emerging DeFi protocol opportunities.
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