By sniping meme coins on a DEX, we made a crazy $50 million profit.

Original Article Title: How We Made +$50M Sniping Shitcoins On DEXs

Original Article Author: CBB, Crypto KOL

Original Article Translation: Luffy, Foresight News

Translator's Note: The author of this article, CBB, is a well-known player in the DeFi and leverage trading community, who previously gained widespread attention for sharing his experience of earning $5 million using the HyperEVM arbitrage robot (see: "Analyzing the HyperEVM Arbitrage Robot: How to Seize a 2-Second Opportunity to Earn $5 Million?"). On October 29, CBB also warned about the high leverage risk of Stream's xUSD. Today, possibly due to the impact of Balancer being hacked, xUSD has indeed experienced a significant de-pegging.

In this article, he recounts his journey from entering the crypto world to sniping shitcoins on DEXs and achieving a $50 million profit within a year. The following is the original content:

August 2020. My brother teaches information technology at a university, while I had just finished an 18-month stint as a product manager at an insurance company.

The cryptocurrency industry bid farewell to years of downturn and was slowly recovering from the collapse triggered by the COVID-19 pandemic. We made a small profit on the Binance Launchpad, but our portfolio's total value was barely $50,000.

At that time, we started hearing about a new protocol called Uniswap. Friends were trading shitcoins on it and often making 3-4 times returns within a few hours. We had no idea what this was, but our intuition told us that this was something unique.

A friend mentioned "sniper trading" to me. He said when the bZx token was listed on Uniswap, a bot made $500,000 in profit solely through sniping. It was simply unbelievable. Both my brother and I were shocked and eager to know how this was possible.

At that time, my brother had no knowledge of the Solidity smart contract language, and we didn't even understand the underlying logic of the blockchain.

First Snipe Attempt

In late August, my family and I were on vacation in Spain. To try a snipe trade on Uniswap, my brother, who had just started learning Solidity a few days prior, joined us.

A token called YMPL was about to launch, and the market interest seemed promising. We formed a sniping team and also brought in a few friends to pool funds together—after all, we were still beginners and didn't want to bear the risk alone.

We put in 50 ETH (valued around $20,000 at the time). As soon as YMPL launched, we successfully sniped 8% of the initial supply. I logged into Uniswap and sold everything in less than 30 minutes.

How much did we profit? 60 ETH (around $30,000). Considering our entire portfolio was less than $50,000 at the time, we were ecstatic in that moment, feeling like making money was incredibly easy.

We wanted to earn more.

Two days later, a new snipe target emerged: VIDYA. With the profits from the previous trade, more funds, and a more confident mindset, we put in 165 ETH and made a net profit of 159 ETH in 15 minutes, higher than the previous gain.

Four days later, another sniping opportunity presented itself. We invested 460 ETH and made a profit of 353 ETH, equivalent to $135,000. This was our first time making a five-figure profit in less than an hour, and the feeling was just amazing.

Uniswap's popularity exploded, trading volume surged, and crypto enthusiasts flocked in. We were well aware that these easy money-making days wouldn't last long. We had to become more professional and truly understand the underlying logic of snipe trading.

What is the Principle of Snipe Trading?

To launch a token on Uniswap, the project team must first add liquidity to the pool. In our initial snipes, we always waited for the "add liquidity" transaction to be recorded on the chain before sending our buy transaction, which always resulted in being one block late.

Meanwhile, some competitors managed to have their transactions "confirmed in the same block" as the liquidity addition transaction.

After some research, we discovered that through an Ethereum node, we could monitor the public mempool and see pending transaction details before they were officially confirmed on the chain.

Starting from September, our sniping process looked like this:

1. Monitor the mempool to capture pending "add liquidity" transactions;

2. Immediately send a buy transaction with the same Gas fee;

3. The goal is to have the buy transaction included in the same block as the add liquidity transaction and executed shortly after.

The New Era of Front-Running on Ethereum

Mid-September 2020.

Ten days had passed without any new token launches, a period of calm that allowed us to upgrade our bot.

However, a new challenge arose: as summer vacation ended, my brother had to return to teaching at the university, and sometimes the front-running opportunities coincided with his classes. Fortunately, at that time, it was during the COVID-19 pandemic, and all classes were conducted online.

Whenever a token was about to launch, he would tell his students, "Do your own research for ten minutes." During this gap, he could focus on executing front-run transactions.

The next target for front-running was CHADS. The market hype was unprecedented, and we were prepared to invest 200 ETH, aiming for a sure win.

I was on a voice call with my brother, feeling both nervous and excited, with the pressure at its peak.

He was the first to see the "add liquidity" transaction on the terminal. When the bot detected the signal, he said in a serious tone, "Ça part." (French, meaning "It's starting")

I will never forget that sentence. Before every front-run since then, he would say the exact same words in the same tone, instantly boosting my adrenaline.

Upon hearing those words, I frantically refreshed the Etherscan browser, hoping to see our ETH balance go to zero — indicating a successful entry.

We did manage to buy in, securing our position with 200 ETH. The candlestick chart instantly spiked, and my task was to manually sell on Uniswap.

The gains from CHADS were truly astonishing. My hands were shaking, sweat was pouring, my focus was at its peak as I sold batch after batch, trying to lock in as much profit as possible.

In the end, we netted 675 ETH (around $270,000). The feeling was unbelievable, but the immense pressure and adrenaline left us exhausted.

There was no time to rest. Three days later was FRONTIER, the same operational process, the same nerve-wracking excitement, and a profit of 800 ETH.

CHARTEX is happening in two days, with a profit of 700 ETH.

Six days later, we have amassed a total profit of 2300 ETH, which is just insane. Just a month ago, after years of toiling in the crypto industry, our total assets were only $100,000 at best.

On September 18, an unexpected surprise occurred: the Uniswap airdrop. Every address that had interacted with Uniswap was eligible to claim the airdrop.

Due to our extensive testing in the preceding weeks, we had accumulated numerous eligible addresses, each able to claim around $20,000. I remember my brother scouring all the wallets he could find and claiming millions of dollars in total.

Our final sniper move that month was on POLS—the platform token of Polkastarter, which later in the year became a top Launchpad.

Smart Contract and Infrastructure Upgrade

It's time to upgrade our bot once again.

During the first month of sniping, we had set a buy limit: invest X ETH and get at least Y amount of tokens. Under this mechanism, we had to execute multiple transactions, especially since most of the time, we had no idea how much liquidity the project team would add.

For instance, if the project team only added 20 ETH of liquidity and we tried to buy with 200 ETH, the preset limit price would be completely invalidated.

My brother devised a new system: for every 1 ETH invested, get at least Y amount of tokens. Before reaching this limit price, buy as many tokens as possible. We were the first to implement such a mechanism.

Another challenge was that we never knew if the project team would use ETH, USDT, or USDC to provide liquidity. My brother designed a smart contract that could automatically buy the target token regardless of the trading pair that went live.

We are still working on improving the bot's speed. In the CHADS snipe, although the profits were significant, we were clearly not the first snipers after liquidity was added.

We deployed Ethereum nodes in multiple regions, pitting them against each other to compete for the first shot at the same transaction. Soon, we discovered that the nodes in Northern Virginia were consistently the fastest.

This led us to believe that Northern Virginia is the prime location for running sniper servers.

Further research confirmed our speculation. At the time, almost all users were conducting transactions via MetaMask, which would route all "Add Liquidity" transactions through Infura's public RPC endpoint, with Infura's servers located in Northern Virginia. More broadly, most Ethereum infrastructure is concentrated in that region.

Therefore, the Amazon Web Services Northern Virginia node was proven to be the most competitive, latency-optimal sniping configuration.

We also devised a highly unconventional meme coin sniping process:

1. Identify Snipe Target: Usually, we had 10-15 crypto circle friends helping us discover new trending meme coins. Whoever first discovered the target could participate in the snipe with a 15% capital allocation (while also bearing corresponding risks). Some friends solely by identifying snipe targets made between $300,000 to $700,000.

2. Confirm the decentralized exchange that is going live (Uniswap, Sushiswap, etc.);

3. Confirm the trading pair going live (ETH, USDT, USDC, etc.);

4. Find the wallet address responsible for the listing (on-chain tracing);

5. Deploy snipe smart contract, setting parameters: fund size and buy limit price;

6. Dump immediately upon listing, usually completed within 30 minutes—because most meme coins are garbage.

Polkastarter Era

From October to early December, the market was relatively calm. The pace of new token listings slowed down, and we even thought the snipe era was coming to an end. Fortunately, we had amassed a significant amount of ETH, and even just holding made for a comfortable life.

But by December, the meme coin market saw a resurgence. Token launches on Uniswap picked up again, and a new Launchpad quietly emerged: Polkastarter.

The first sale was the SpiderDAO project on Polkastarter, with each wallet limited to a 2.5 ETH purchase. However, my brother noticed that this purchase limit was only enforced at the user interface (UI) level, and we could still make large purchases directly through the contract. We sent several large transactions, successfully buying 50% of the total supply at launch and sniping. This transaction earned us $500,000, and we were back in action.

This example fully reflects the current state of the crypto ecosystem. Most project teams are complete outsiders, with no clue what they are doing. This is simply a heaven-sent opportunity for us, and we must certainly make the most of it.

At that time, some decentralized finance (DeFi) projects started launching synthetic assets, and we made $600,000 through arbitrage.

December became a turning point in our entrepreneurial journey—my brother decided to resign from his position as a university professor.

In January of the following year, we moved to Dubai, and both of us dedicated ourselves fully to sniper trading.

Our mindset was simple: never pass up an opportunity. Even if there was only a "mere" $10,000 profit potential, we would take action. We knew this window of opportunity would not last forever and did not want to miss any chance.

In January, we again reaped some nice profits, such as PHOON, accumulating $3 million in profits.

Most of these profits were held in ETH, and the price of ETH also skyrocketed—from $200 when we started sniping to $1,400 by the end of January, within a short span of five months.

Anti-Sniper Measures

Starting in February 2021, more and more project teams began implementing anti-sniper measures when launching tokens. People had grown tired of snipers and started incorporating anti-sniper mechanisms into token launches.

The first type of measure: Buy-in cap. In the first few minutes after the token launch, users could only buy X amount of tokens. My brother was the first to design a sniper smart contract with a looping function, allowing a single transaction to buy most of the initial supply—each loop bought the buy-in cap amount of tokens. With this smart contract, we stood out in the competition because most rivals did not have this technology.

Smart contract innovation was one of our biggest advantages. My brother always found the sniper's loophole, and we actually welcomed anti-sniper measures—they made the competition less fierce.

The second type of measure: Single-wallet buy-in cap. My brother designed the main contract with "sub-smart contracts," where the main contract would invoke a new sub-contract for each buy-in transaction.

These features proved very useful and played a significant role during the altcoin frenzy on the Binance Smart Chain in the following months.

Polkastarter Peak and Fierce Competition

Starting in February 2021, we officially entered the Polkastarter era. Every token launched on Polkastarter experienced a massive surge, making each token a high-return opportunity for snipers.

However, the competition became extremely fierce. While we were still able to profit, the days were getting tougher.

We designed a new feature called "Suicidal Snipe."

The principle is simple: we noticed many enthusiastic players not setting any buy limit when sniping. Our "Suicidal Snipe" feature would execute an additional unlimited price buy transaction, followed by an automatic sell four blocks later, harvesting all snipers entering after us.

While not a game-changing strategy, earning 50-150 ETH from it was quite easy.

Later, the competition heated up, with a guy named 0x887 being faster than everyone else. We spent countless hours upgrading our bot, trying to customize an Ethereum node for the fastest sniping speed, conducting daily repeated tests, but we could never outpace this sniper.

Binance Smart Chain Frenzy Season

Fast forward to mid-February 2021. My brother and I moved into the same place in Dubai—this was incredibly exciting as we hadn't lived in the same city for the past six years. We were fully immersed in sniping trades, constantly seeking new opportunities, and always ready to design and develop new features.

Despite the intense competition on Ethereum, we continued sniping, with profits still rolling in. However, we knew this situation wouldn't last forever.

We heard that the Binance Smart Chain (BSC) ecosystem was thriving, with some tokens performing remarkably well. We decided to heavily invest in BNB, which was priced around $80 at the time—might as well be prepared for future sniping.

Our first BSC snipe was the meme coin BRY on February 16. We were clueless about the sniping patterns and competition on BSC—it was time to explore.

We invested 200 BNB, sold out within 30 minutes, profited 800 BNB, equivalent to $80,000. While not as lucrative as Ethereum, it was still pretty good with promising potential.

Our second BSC snipe target was MATTER: invested 75 BNB, sold 2100 BNB. My my, netting 2000 BNB! Additionally, BNB's price showed strong performance, reaching $240 by the end of February. We felt tremendous potential—top sniper 0x887 seemed to completely overlook BSC, which was practically free money for us. We had to go all-in and snipe all targets.

March is a fruitful month. Token launches on Ethereum are still hot, and we have earned millions of dollars. The BSC market is even crazier; throughout March, we made a profit of 15,000 BNB, especially with KPAD, where we earned 8,300 BNB.

The memory of my sniper battle with KPAD is still fresh in my mind; it is our largest single transaction profit to date.

I was in my apartment in Dubai at the time, knowing the token was experiencing a lot of hype upon its launch and was sure to surge. I was so nervous that I was sweating, even questioning if I could successfully enter the position.

After the project team launched, BSCscan was extremely slow. I logged into Pancakeswap and saw a bunch of KPAD tokens in my wallet — oh my! My focus was immediately heightened, and I was like a obsessed computer geek, starting to sell in batches. Just selling 1% of my position earned me a large sum of money. My hands were shaking badly, and I was fully focused on executing the sell orders, making a $2 million profit within an hour.

Five days later, a meme coin called COOK was set to launch on multiple chains. I told my brother that we should focus our sniper efforts on the Huobi Eco Chain (HECO) because the competition there would be minimal. After the token launched on HECO, we invested 550 BNB to buy and then successfully cross-swapped to BSC before the trading pair unlocked, selling everything for a profit of 3,000 BNB. The feeling was amazing!

By the end of March, BNB's price had risen to $300.

BSC Infrastructure and Optimization

In early April, the market pace slowed down. We took the opportunity to relax on a vacation in the Maldives, but as soon as we landed, we heard that several popular meme coins were about to launch on BSC, so we had to be prepared.

We decided to conduct a speed test on BSC. At that time, BSC's operation was different from Ethereum: on Ethereum, you need to quickly detect pending add liquidity transactions and then swiftly send your own transaction to other nodes.

A few weeks prior, we discovered that the transaction order within BSC blocks was random. When you detect a pending transaction and send a buy transaction, your transaction might end up before the add liquidity transaction, causing the transaction to fail.

We deployed 10 nodes on Amazon Web Services (AWS) global nodes, with each node sending 50 transactions, attempting to sniper a random test transaction. After completing 20 sets of tests, we analyzed transactions within the same block as the add liquidity transaction.

Draw the following conclusions:

1. The highest performing nodes are located in Northern Virginia, Frankfurt, and sometimes the Tokyo node also performs well;

2. The first 5-15 transactions sent by a single node are most likely to successfully enter the target block;

3. Configuring the highest-powered servers on Amazon Web Services (AWS) allows more transactions to successfully enter the target block.

For future sniper trades, we have built an infrastructure on BSC consisting of 150-200 nodes, with each node sending 10 transactions.

Operating this infrastructure on AWS costs between $40,000 and $60,000 per month.

For my brother, operating this infrastructure is a significant challenge — he must individually start nodes on 150 terminals. Keep in mind, we have no employees; everything is done by ourselves, just my brother and me.

We have a significant advantage on BSC: on one hand, we have rich experience on Ethereum, and on the other hand, we are willing to invest in infrastructure, which sets a high barrier for small snipers.

The Memecoin Era on BSC

Now we are fully focused on BSC, sometimes conducting 6 snipes in a day, with almost no time for a normal life, our minds filled with sniping meme coins. We are always racing against time, spending most of our time preparing for new sniper trades, with little time for optimizing equipment.

I remember many sniper experiences, especially the one with PINKM (Pinkmoon) — due to a purchase limit, we used 120 wallets to snipe, making a profit of $3 million within two hours. The next day, I bought a Lamborghini Aventador SV sports car.

In May 2021, two Launchpads on BSC started gaining popularity, where anyone could execute launch transactions. My brother was the first to design and develop a smart contract that could complete token launches and purchases in the same transaction.

Now it may seem common, but at that time, no one had done it this way. I remember for a week, the projects on these two Launchpads were extremely hot, and we sniped almost all token launches, making a six-figure income every day for a whole week. One night, my brother messaged me while I was having dinner with friends at Nammos restaurant, saying he wanted to snipe a project, and by the time I got home, our profit had increased by another $1 million.

At the end of the month, the hype in the BSC market started to cool down, and we decided to sell off most of our holdings when the BNB price was around $450.

There will be a few sniper opportunities in June, but the overall market sentiment feels quite weak.

The end of this sniper era is actually a kind of relief for us—we are exhausted and really need a good rest.

All summer, we have been traveling around, and we can finally enjoy life.

A Stroke of Unexpected Luck

In August 2021, while we were enjoying our summer vacation and not heavily involved in the cryptocurrency market, we stumbled upon a wallet that was blacklisted and still held EVN tokens that we had not been able to sell before.

At that time, the price of EVN skyrocketed, and the tokens in just one of these wallets were worth around $1 million (excluding slippage, as shown on Etherscan)—and we had over 20 blacklisted wallets.

We first tried to sell $200 worth of tokens on Uniswap, and it was successful. We thought, "Wow, maybe we can sell a small amount from each wallet and potentially make a few thousand dollars."

We tried selling again in the same wallet, and this time we made $2000. We were amazed and felt like this afternoon might bring big returns.

Next, we tried again, this time selling all the tokens in this wallet: we ended up with 233 ETH (initially spent only 2.5 ETH to buy in).

Adrenaline rushing, we quickly checked all the blacklisted wallets to sell on Uniswap as soon as possible. Some wallets were still blacklisted, while others had the restrictions lifted—we had no idea why. We sold like crazy, watching millions of dollars flowing in as if we were printing money.

For 15 minutes straight, we desperately sold all the tokens we could find and then transferred all the funds to a cold wallet. We originally expected to earn $2-3 million, but on that summer afternoon, we made $6 million out of thin air.

Until now, we still have no idea what happened or why these wallets were unrestricted.

This month, when ETH price broke $3000, we sold off a large amount of ETH earned through sniping—we felt it was time to lock in profits and achieve financial freedom.

Epilogue

That year was perhaps the craziest year we have ever had. Starting with only $40,000 in funding, no understanding of the underlying logic of blockchain, and zero knowledge of Solidity.

In the end, we sniped over 200 shitcoins on more than 10 different chains. It was my greatest honor to go through all of this with my brother.

Those emotional ups and downs and exhilarating experiences are almost indescribable.