According to on-chain security tracker PeckshieldAlert, the Arbitrage Bot, known as PrintMoney, has emitted more than $2 million in cryptocurrency, indicating a serious exploit has collided with the BNB chain ecosystem. The dangers of using fully on-chain arbitrage bots are once again highlighted by this attack, especially in unauthorized environments such as BNB chains.
The purpose of an arbitragebot, an automated trading agent, is to take advantage of price discrepancies between exchanges or liquidity pools. Specifically, on-chain bots perform transactions across Dexes, such as Pancakeswap and Venus, by working directly within the smart contract protocol. Despite their potential utility, these bots are extremely vulnerable as all trade tactics and weaknesses are openly apparent and open to abuse. As the transaction screenshot shows, the breached wallet lost money on many assets.
With over $11 million in stubcoins and hundreds of thousands of packaging assets being emitted overall, it indicates that the exploits are systematic and may have exploited a flaw in smart contracts or an improperly constructed permission structure in bot arbitrage routines.
Operational security of many on-chain bots is one of their main weaknesses. They become the desired target as they need to maintain a considerable balance to execute quick transactions. Furthermore, if smart contracts are not carefully considered, bad actors may be able to manipulate pool liquidity, create fictional arbitrage opportunities, and leverage callback capabilities.
Centralizing funds is another issue. To save capital, arbitrage operators frequently combine user funds into a single bot. A large single point of failure can result from the bot’s compromise, putting all pooled assets at risk.
Another warning sign for those using on-chain automated trading tools is this case. Assume everything on the chain is what appears to be an attacker, whether you’re an investor or a developer, and that your bot is a duck that you’re sitting on without taking the right precautions.
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