> For the complete documentation index, see [llms.txt](https://eigenphi-1.gitbook.io/head-first-defi/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://eigenphi-1.gitbook.io/head-first-defi/under-the-hood-of-the-defi-lego/how-does-the-grok-token-exploiter-exploit-the-x-token-by-baking-his-own-cake-and-eating-it.md).

# How Does the Grok Token Exploiter Exploit the X Token By Baking His Own Cake And Eating it?

### Strategy One Liner

The bot utilizes the methods of the ERC20 X token to create the arbitrage opportunity between a Uniswap V2 pool and a Uniswap V3 pool, and takes advantage of it, making a profit of $4,844.

### Big Picture

EigenTX Link: <https://bit.ly/3xMOYIt>

<figure><img src="/files/zwkt4qQkHpJ8Leq78YE2" alt=""><figcaption></figcaption></figure>

### Key Steps

**Stage 1: Prep the Uniswap V2 X-WETH pool.**

Step 0: Borrow 6,493,128,478.6032 X from the Uniswap V3 pool of X-WETH.

<figure><img src="/files/XBm9ZwGo5ONJtAvuzyMy" alt=""><figcaption></figcaption></figure>

Steps 1-6: Swap 3,431,282,845.8058 X for 23.4081 ETH at UNI-V2, and transfer 34,659,422.6849 X back to X contract as a 1% tax.

<figure><img src="/files/GHUfPKCJah5zVAruN6lF" alt=""><figcaption></figcaption></figure>

Steps 7-12: Swap 34,312,828.4581 X for 0.2006 ETH at UNI-V2, transfer 346,594.2268 X back to X contract as a 1% tax.

<figure><img src="/files/gRdFost7Wp0mlR2SAD9T" alt=""><figcaption></figcaption></figure>

**Stage 2: Overflow the X contract to create the arbitrage prospect.**

Step 13: Transfer 2,827,595,502.6415 X back to the X contract, bringing the balance of the X token of the X contract to 10,000,346,595.226849.

![](https://substackcdn.com/image/fetch/w_1456,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fsubstack-post-media.s3.amazonaws.com%2Fpublic%2Fimages%2F616519bf-5fcd-443d-b4d6-abcdfe3c769a_1362x275.png)

The simulation on Blocksec shows the effect.

<figure><img src="/files/BLvZ7vF17KmSlHFCzVVl" alt=""><figcaption></figcaption></figure>

<figure><img src="/files/xv7vedKa1fNqKQR7woAJ" alt=""><figcaption></figcaption></figure>

<figure><img src="/files/ggQPSgTMGvlXcdFS4qjE" alt=""><figcaption></figcaption></figure>

<figure><img src="/files/eKRYvFG7xJDOXU8AbFsf" alt=""><figcaption></figcaption></figure>

Steps 14-26: Swap 99,000,000 X for 0.2892 ETH at UNI-V2, and transfer 1,000,000 X back to X contract as a 1% tax.

The swapping of X for ETH this time triggers an internal function, X.shouldContractSwap(), returning true, which is the result of the code below:

```
 aboveThreshold = balanceOf(address(this)) >= swapThreshold;
```

The transfer in step 13 satisfies the condition: the balance of X is bigger than the threshold of 10,000,000,000. Before step 13, this code returns False.

You can find it in [the contract of the X token](https://etherscan.io/address/0xa62894d5196bc44e4c3978400ad07e7b30352372#code).

<figure><img src="/files/U696ow5FMeI7JDmMV7Aq" alt=""><figcaption></figcaption></figure>

Next, the X contract injects 10,000,000,000 X tokens into the Uniswap V2 pool and puts the received ETH to its deployer’s EOA.

**This huge injection of X inflates its value, causing the exchange rate of X against ETH to surge to 342,323,651 X per ETH. The price gap between this Uniswap V2 pool of X-ETH and the Uniswap V3 pool of X-WETH.**

We can split the steps of 14 to 26 as below.

Steps 14-18: X contract transfer 10,000,000,000 X to UNI-V2 and swap X for 41.3756 WETH, unwrap WETH and transfer ETH back to X

<figure><img src="/files/IrTDl3KmRQ0U1jBAmtNR" alt=""><figcaption></figcaption></figure>

Steps 19-20: X contract transfer 20.4830 ETH and 20.9020 ETH to an EOA address

<figure><img src="/files/EtZlzNhWvTES7dIRpddN" alt=""><figcaption></figcaption></figure>

Steps 21-26: *To* address finishes the swap operation at Uniswap V2 pool and pays tax.

<figure><img src="/files/1A7LtF6rY8gMpZ764ATH" alt=""><figcaption></figcaption></figure>

**Stage 3: Harness arbitrages.**

Step 33: *To* address repays the flash loan, 6,558,059,763.3892 X, to the Uniswap V3 pool of X-WETH.

<figure><img src="/files/OA4aiGFE4S0A6zjcCPzx" alt=""><figcaption></figcaption></figure>

Steps 34-39: *To* address swaps 31,457,966.2838 X for 0.1402 ETH at the Uniswap V2 pool, transferring 317,757.2352 X back to X contract as a 1% tax.

<figure><img src="/files/m7s5CiQDjypZSlMiNZPa" alt=""><figcaption></figcaption></figure>

Step 40: Borrow 5.1598 WETH from a new Uniswap V3 Pool of USDC-ETH.

<figure><img src="/files/PZhr22yhF04aXuu8o4vy" alt=""><figcaption></figcaption></figure>

Steps 41-48: To address swap 5.3 ETH for 1,123,530,803.0087 X at the Uniswap V2 pool, which transfers 11,348,795.99 X back to X contract as a 1% tax.

<figure><img src="/files/mh44j6ceNs2Sw3QjkdLW" alt=""><figcaption></figcaption></figure>

<figure><img src="/files/jPcnjL84Dwv0hxYblJGo" alt=""><figcaption></figcaption></figure>

Steps 49-50: Swap 1,123,530,803.0087 X for 7.8274 WETH at the Uniswap V3 pool of X-WETH.

<figure><img src="/files/kjnbWLkKWqpFAs6JK5bI" alt=""><figcaption></figcaption></figure>

Step 51: *To* address repay the flashloan, 5.1624 WETH, to the second UniswapV3Pool.

<figure><img src="/files/EK1fueIiJ7eJyNhuzlXf" alt=""><figcaption></figcaption></figure>

Steps 52-53: Unwrap 2.6651 WETH to 2.6651 ETH.

<figure><img src="/files/gCXgzB5YLNvVLJGPLkLB" alt=""><figcaption></figcaption></figure>

### Key Assets

X, ETH, WETH

### Simplified Illustration

<figure><img src="/files/GWSZaePeY6BW1Y9Rpkwf" alt=""><figcaption></figcaption></figure>

### More Details

* From [the contract page on Etherscan](https://etherscan.io/address/0x2256e6a917e3909d5db8796f756a6c25348bf83f), we can see the EOA labeled as GROK Toekn Exploiter did all the transactions.

<figure><img src="/files/p44EZtlTKxB9maX59HPt" alt=""><figcaption></figcaption></figure>

* 2 transactions involving SPIKE utilized the same strategy to do arbitrages. You can find [more details](https://eigenphi.substack.com/i/146452249/what-about-the-spike) here.&#x20;