mev-beta/PRODUCTION_READINESS_STATUS.md

MEV Bot V2 - Production Readiness Status

Date: 2025-11-10
Version: 1.0.0-rc1
Status: 🟡 TESTING PHASE - SAFE FOR SMALL-SCALE TESTING ONLY

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Executive Summary

The MEV Bot V2 has comprehensive safety mechanisms in place but is NOT ready for large capital deployment. It is suitable for:

• ✅ Dry-run monitoring (simulation mode)
• ✅ Small-scale testing (0.1-1 ETH capital)
• ✅ Testnet validation

DO NOT deploy with significant capital (>5 ETH) until all validation phases complete

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Readiness Assessment

✅ Ready for Production

Component	Status	Notes
Compilation & Build	✅ READY	All packages compile successfully
Docker Containerization	✅ READY	31.6MB optimized image
Safety Configuration	✅ READY	Comprehensive .env.production.safe
Deployment Documentation	✅ READY	20+ page deployment guide
Safety Checklists	✅ READY	Pre-deployment & monitoring checklists
Circuit Breaker Config	✅ READY	Configured (needs testing)
Emergency Stop	✅ READY	File-based mechanism (needs testing)
Position Size Limits	✅ READY	Configured conservatively
Dry-Run Mode	✅ READY	Simulation without execution

⚠️ Needs Validation Before Large Capital

Component	Status	Risk Level	Blocker?
Profit Calculations	⚠️ UNTESTED	🔴 HIGH	YES
Circuit Breaker	⚠️ UNTESTED	🔴 HIGH	YES
Emergency Stop	⚠️ UNTESTED	🟠 MEDIUM	YES
Execution Logic	⚠️ UNTESTED	🔴 HIGH	YES
Gas Estimation	⚠️ UNTESTED	🟠 MEDIUM	NO
Slippage Protection	⚠️ UNTESTED	🔴 HIGH	YES

❌ Not Ready / Missing

Component	Status	Impact	Timeline
WebSocket Sequencer	❌ FAILING	Can't monitor pending txs	1 week
Archive RPC Integration	❌ MISSING	Pool discovery limited	Immediate
Real-time Pool Discovery	❌ HARDCODED	Stale data risk	1 week
Profit Validation Tests	❌ MISSING	Unknown calculation accuracy	3 days
Testnet Validation	❌ NOT DONE	Execution untested	1 week
Performance Benchmarks	❌ MISSING	Latency unknown	3 days
Monitoring/Alerting	❌ BASIC ONLY	Limited visibility	3 days

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Safety Features Status

✅ Implemented

1. Dry-Run Mode - Simulation without real transactions
2. Position Size Limits - Max 1 ETH per trade (configurable)
3. Daily Volume Limits - Max 10 ETH daily (configurable)
4. Slippage Protection - 1% max slippage (configurable)
5. Gas Price Limits - 50 gwei max (configurable)
6. Minimum Profit Thresholds - 0.05 ETH minimum (configurable)
7. Circuit Breaker Configuration - Stops after 3 losses or hourly/daily limits
8. Emergency Stop File - Touch file to immediately stop
9. Rate Limiting - Max trades per hour configurable
10. Comprehensive Logging - Structured logs for all operations

⚠️ Configured But Untested

1. Circuit Breaker Logic - Code exists, needs real-world testing
2. Emergency Stop - Mechanism in place, needs testing
3. Transaction Simulation - Pre-flight checks before execution
4. Sandwich Attack Protection - Slippage limits should help
5. Gas Cost Validation - Checks profit > gas cost

❌ Missing / To Be Implemented

1. Real-time Profit Validation - Need known test scenarios
2. Historical Backtesting - Validate strategy on past data
3. Multi-RPC Failover - Single point of failure
4. Advanced Monitoring - Grafana dashboards need setup
5. Automated Alerting - Webhook integration needs configuration

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Deployment Recommendation

Phase 1: DRY-RUN (Days 1-3) - ✅ SAFE TO START

# Copy and configure
cp .env.production.safe .env.production

# Edit with your RPC and keys
nano .env.production

# Deploy in dry-run mode
docker build -t mev-bot-v2:production .
docker run -d --name mev-bot-v2-prod \
  --env-file .env.production \
  mev-bot-v2:production

# Monitor for 24+ hours
docker logs -f mev-bot-v2-prod

Capital Required: None (simulation only)
Risk Level: 🟢 NONE (no real transactions)
Success Criteria: Stable for 24h, opportunities detected, no errors

Phase 2: TESTNET (Days 4-7) - ✅ SAFE IF PHASE 1 SUCCESSFUL

# Switch to Arbitrum Sepolia testnet
# Edit .env.production:
CHAIN_ID=421614
RPC_URL=https://sepolia-rollup.arbitrum.io/rpc
ENABLE_EXECUTION=true

Capital Required: Testnet ETH (free from faucet)
Risk Level: 🟢 NONE (testnet has no value)
Success Criteria: Transactions execute, circuit breaker works, no bugs

Phase 3: MAINNET MICRO-TEST (Days 8-14) - ⚠️ USE CAUTION

# Switch to mainnet with strict limits
# Edit .env.production:
CHAIN_ID=42161
RPC_URL=https://arb-mainnet.g.alchemy.com/v2/YOUR_KEY
MAX_POSITION_SIZE=100000000000000000  # 0.1 ETH only!
MAX_DAILY_VOLUME=500000000000000000   # 0.5 ETH max

Capital Required: 0.5-1 ETH (amount willing to lose for testing)
Risk Level: 🟠 MEDIUM (real money, small amounts)
Success Criteria: Net profitable over 7 days

Phase 4: GRADUAL SCALE (Weeks 3-8) - ⚠️ ONLY IF PROFITABLE

Capital Required: Start 1 ETH, gradually increase
Risk Level: 🔴 HIGH (larger capital at risk)
Prerequisite: Phase 3 must be net profitable

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Current Blockers for Large-Scale Deployment

1. BLOCKER: Profit calculations not validated

   • Impact: Could lose money on unprofitable trades
   • Solution: Create test scenarios with known outcomes
   • Timeline: 3 days

2. BLOCKER: Execution logic not tested on mainnet

   • Impact: Unknown transaction success rate
   • Solution: Complete Phase 2 & 3 testing
   • Timeline: 1-2 weeks

3. BLOCKER: Circuit breaker not tested in real conditions

   • Impact: May not stop losses as expected
   • Solution: Test on testnet with losing scenarios
   • Timeline: 3 days

4. CRITICAL: Archive RPC not configured

   • Impact: Pool discovery uses stale data
   • Solution: Get Alchemy/QuickNode subscription
   • Timeline: Immediate (just configuration)

5. CRITICAL: WebSocket sequencer connection failing

   • Impact: Missing pending transactions
   • Solution: Debug WebSocket connection or use polling
   • Timeline: 1 week

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Estimated Timeline to Full Production Ready

Optimistic (everything works first try): 2-3 weeks

1. Week 1: Archive RPC + Dry-run + Testnet
2. Week 2: Mainnet micro-test
3. Week 3: Gradual scale if profitable

Realistic (normal development): 4-6 weeks

1. Week 1-2: Testing & validation, fix issues
2. Week 3-4: Testnet + mainnet micro-test
3. Week 5-6: Validate profitability, gradual scale

Conservative (issues found): 8-12 weeks

1. Month 1: Testing finds calculation errors, needs fixes
2. Month 2: Re-testing after fixes
3. Month 3: Gradual deployment & validation

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Infrastructure Costs

Item	Cost	Required?
Archive RPC (Alchemy/QuickNode)	$200-500/mo	YES
Private RPC (Flashbots)	Free	Recommended
Dedicated Server	$50-200/mo	YES
Monitoring (self-hosted)	Free	YES
Alerting (Slack/Discord)	Free	YES

Total Monthly Cost: $250-700/month minimum

Break-even: Need to generate >$300/month profit just to cover costs

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Risk Assessment

🟢 LOW RISK - Safe to Deploy Now

• Dry-run monitoring (Phase 1)
• Testnet testing (Phase 2)
• Documentation review

🟠 MEDIUM RISK - Use Extreme Caution

• Mainnet micro-testing with 0.1-1 ETH (Phase 3)
• Small position sizes (<1 ETH)
• With ALL safety mechanisms enabled

🔴 HIGH RISK - DO NOT DO YET

• Deployment with >5 ETH capital
• Disabling safety mechanisms
• Increasing position sizes before validation
• Automated operation without monitoring

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Next Steps (Recommended Order)

1. Immediate (Today):

   • Get Archive RPC subscription (Alchemy/QuickNode)
   • Review PRODUCTION_DEPLOYMENT_GUIDE.md
   • Review SAFETY_CHECKLIST.md

2. This Week:

   • Start Phase 1: Dry-run for 24+ hours
   • Create profit validation test scenarios
   • Fix WebSocket sequencer connection
   • Set up monitoring (Prometheus + Grafana)

3. Next Week:

   • Start Phase 2: Testnet deployment
   • Test circuit breaker
   • Test emergency stop
   • Validate profit calculations

4. Week 3-4:

   • Start Phase 3: Mainnet micro-test (0.1-1 ETH)
   • Monitor continuously
   • Calculate actual ROI
   • Assess profitability

5. Month 2+ (If Profitable):

   • Gradually increase capital
   • Optimize parameters
   • Expand to more pools
   • Track long-term performance

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Conclusion

The bot CAN be deployed safely for testing, BUT:

• Start with dry-run mode (no real transactions)
• Use testnet before mainnet
• Start with tiny amounts on mainnet (0.1-1 ETH)
• Follow the deployment guide strictly
• Monitor continuously
• Stop immediately if unprofitable

The bot is NOT ready for:

• Large capital deployment (>5 ETH)
• Automated operation without monitoring
• Production use without validation

Follow the 4-phase deployment sequence to minimize risk and validate profitability before scaling.

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Remember: It's better to spend 4-6 weeks testing carefully than to lose significant capital in the first hour of deployment.

Start small. Scale slowly. Stop quickly if problems occur.