Trader Loses $2 Million in Routing Error on Decentralized Exchange

The loss occurred when the trader’s routing contract directed 1,126 Ether into an AVAIL/WETH pool with insufficient depth. This trade inflated the price of AVAIL tokens by roughly 120 times, creating a massive imbalance. Blockchain security firm GoPlus Security confirmed the incident was not a traditional sandwich attack, but rather a backrun extraction. An arbitrage bot identified the price distortion instantly, spending a nominal amount of WETH to drain the pool’s excess value.

Transaction data shows the trade moved through a complex path, involving an exchange for 6.68 million AVAIL tokens before a final conversion into Lighter tokens. By the time the transaction settled, the arbitrage searcher had extracted approximately 1,072 WETH. Titan Builder, the entity responsible for constructing the block, received 1,018 ETH as a builder payment, securing the largest share of the captured value.

Crypto trader Ruslan Khairullin noted that the catastrophe serves as a stark reminder of the risks inherent in automated routing. He urged users to manually inspect execution paths before confirming transactions, rather than relying solely on the projected output displayed by exchange interfaces. Titan Builder, which has generated over $112 million in revenue this year, remains at the center of the debate regarding how block builders profit from these automated market inefficiencies.