0x: Base Network Partial propAMM Manipulates Quotes, Each Trade May Cause 5 to 10 Basis Points Loss

CryptoWorld reports that DEX aggregation protocol 0x has released a report stating that some propAMMs on the Base network are engaging in systemic quote manipulation. The study found that these operators use Base’s Flashblock architecture to publish highly attractive prices in the last approximately 200 milliseconds of a block (the final Flashblock) to attract aggregator routing, but immediately adjust prices at the start of the next block. Such behavior often results in traders facing an additional 5 to 10 basis points of loss. Based on $1 billion in monthly trading volume, a single liquidity source could cause users to lose an extra $500,000 per month. Additionally, the report points out that some operators exploit delays between quoting and settlement to maliciously widen spreads or manipulate LP rewards through “phantom liquidity,” by depositing large amounts of liquidity before a block ends and quickly withdrawing at the start of the next block. This can lead aggregators to direct users into paths with higher slippage due to inaccurate depth data. 0x states that it currently integrates five propAMMs on the Base network but will continuously monitor execution quality and cut off any violating liquidity sources to protect users.