Saddle Finance Launch-Day Arbitrage

On January 20, 2021, Saddle Finance lost approximately $276,000 within roughly an hour of launch. A flaw in its stableswap math/implementation let an attacker (and copycat arbitrageurs) swap at badly mispriced rates, draining LP value on day one. (Saddle later suffered a much larger, separate April 2022 metapool exploit.)

What happened

Saddle's initial stableswap deployment mispriced swaps under certain conditions; within an hour of launch an attacker exploited the mispricing for ~$276K, with MEV/arbitrage bots piling on.

Why it matters

Saddle's launch-day loss is a clean instance of new protocols being attacked within minutes of launch (Punk Protocol, Jimbo's, Loopscale). Sophisticated actors monitor new deployments specifically; the window between "contracts live" and "first exploit" is routinely minutes. That Saddle was then exploited again, far larger, 15 months later (April 2022) also places it in the multi-incident group — the recurring catalogue verdict that a first incident is a signal, and inadequate systemic remediation invites the second.