Ross Ulbricht Lost $12 Million To An MEV Bot On Solana: Here’s What Happened
Ross Ulbricht lost $12 million to an MEV bot while trying to provide liquidity for the ROSS meme coin on Raydium, a DEX on Solana.
Some traders are indeed “minting” money trading meme coins. Getting a piece of the $105 billion market cap industry seems to be the order of the day.
The bad news is that out of the millions, even billions, of ROI scooped, only a tiny percentage of meme coin traders win. Most lose, not only due to bad entries and rug pulls but sometimes to bots.
Ross Ulbricht Loses Money: What Happened?
Arkham Intelligence analysis from January 30 reveals that Ross Ulbricht, or someone with access to his wallets on Solana, lost roughly $12 million in a failed attempt to supply liquidity for a meme coin named ROSS. The meme coin, ROSS, similar to Trump, was minted on Pump.fun, a launchpad on Solana.
According to the blockchain analytics platform, Ulbricht lost money due to a possible flaw in the liquidity pool on Raydium, a DEX on Solana.
Unfortunately for him, he mistakenly initialized the liquidity pool at the wrong price. This error was quickly picked up by a Maximal Extractable Value (MEV) bot, allowing it to instantly snipe $1.5 million worth of tokens, or 5% of the total supply, and sell them into the pool.
(Source)
Ulbricht (or the account administrator) repeated the process even after this error. However, instead of $1.5 million, the MEV bot took another $10.5 million, or 35% of the total supply, and sold it into the pool.
After this batch of bot selling, the ROSS token plunged by over 90%.
(Source)
Blame Solana and MEV bots?
With prices dropping, ROSS holders lost money.
Unless ROSS picks up momentum now that Ulbricht is a celebrity and known for making crypto mainstream back in the day, the token will likely flat-line or even fall further.
The question is: Should you blame Ulbricht or Solana’s marauding bots?
Ulbricht might have made a mistake, but the presence of MEV bots meant there was no time to fix the error.
Instead, MEV bots spotted this opportunity to arbitrage and make money at the expense of others.
And this is a common theme in Solana.
With meme coins booming and billions traded daily, MEV bots are busy (unfairly) sniping millions from all DEX traders.
These bots continuously scan the blockchain, exploiting inefficiencies and pricing mistakes in DEXes like Raydium. Once they pick out an error, they execute ahead of users, extracting value from them.
For example, in 2024, a trader mistakenly bought WIF at $3 while the token traded for $0.20. An MEV bot spotted the error and instantly capitalized on this mistake.
Reports show that Jito Labs, a flashbot operator, leads MEV operations in Solana. In 2024, they cumulatively generated nearly $500 million on Solana alone.
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