Understanding Oracle Extractable Value (OEV)
Understanding Oracle Extractable Value (OEV)
🤔 Oracle drama unfolding
Oracle Extractable Value (OEV) is a type of MEV related to oracle updates. It arises from price updates triggering liquidation bonuses on lending protocols, causing some updates to be more valuable than others. Annually, lending protocols across chains lose millions to OEV.
@OEVNetwork proposes a Layer 2 solution to recapture OEV:
- Eliminates most lost OEV
- Maintains user experience
- Preserves data feed security
- Returns captured OEV to dApps
This solution integrates with API3's data feeds, allowing dApps to recapture lost value. It optimizes liquidations and improves protocol performance while maintaining security.
OEV-aware oracles represent an evolution in oracle architecture, potentially fostering innovation and new business models in the lending protocol space.
What is oracle extractable value, or OEV❓ Here’s a short thread to understand the basics and to learn why solving OEV will disrupt the oracle landscape. 🧵
API3 DAO Ships New Integrations and Vaults Amid Market Volatility
API3 DAO continued development despite market conditions, delivering several key updates: - **New chain integration**: Robinhood Crypto support added - **Vault launch**: Purinta USDC Vault now live - **Morpho market**: CASHCAT/USDG market deployed - **Purinta features**: Additional functionality delivered The team emphasized their commitment to consistent building regardless of market direction, maintaining focus on infrastructure development and ecosystem expansion.
API3 Oracles Recapture Liquidation Value for Markets
API3 has developed an oracle system that changes how liquidation profits are distributed in DeFi markets. **How it works:** - When price movements trigger position liquidations, those updates generate value - Traditionally, this value goes to MEV searchers and block builders - API3's oracles capture this value and return it to the market itself **Current deployment:** - Over 200 data feeds available on the API3 Market - Integrated with OEV Network across 40+ chains - Provides real-time data access with value recapture built in This approach redirects profits that would normally leak out of protocols back to the platforms and their users, rather than being extracted by third parties.
Zero-Percent Borrow Campaign Runs Without Token Emissions
A new 0% borrowing campaign is operating without token emissions, breaking from the typical DeFi playbook. **How it differs:** - Traditional campaigns print tokens as rewards - Farmers typically dump those tokens immediately - Rates rise again once emissions end **This approach:** - No new tokens are minted - The market sustains itself organically - Eliminates the boom-bust cycle of emission-based incentives This model addresses a recurring problem in DeFi where artificial incentives create temporary activity that evaporates when rewards stop flowing.
Zero-Cost USDC Borrowing Against wstETH on Morpho Labs
**Free borrowing opportunity on Morpho Labs** Traders can currently borrow USDC against wstETH at 0% net cost on Morpho Labs. While the base rate is 2.8% APR, live incentives fully cover the borrowing cost. **Key details:** - Market: wstETH/USDC on Morpho Labs - Base rate: 2.8% APR - Net rate after incentives: 0% - Campaign details: [Merkl opportunities](https://app.merkl.xyz/opportunities/ethereum/MORPHOBORROW/0x6d2FbA32B8649d92432D036c16aA80779034b746) - Market link: [Morpho market](https://app.morpho.org/ethereum/market/0x6d2fba32b8649d92432d036c16aa80779034b7469b63abc259b17678857f31c2/wsteth-usdc) The opportunity is OEV-boosted and powered by API3 DAO. The incentive program has a limited duration, so rates may change when the campaign ends.
Api3 Activates Security Monitoring for Morpho Vaults with Hypernative Partnership
Api3 has launched enhanced security monitoring for its Morpho vaults through a partnership with Hypernative Labs. **Key Features:** - Continuous monitoring layer added to existing security infrastructure - Protection against malicious actors through specialized watchguard system - Three vaults now live with enhanced security: - [Api3 dCOMP USDC](https://app.morpho.org/ethereum/vault/0x36cfe1568461E499391ef0A555300F1ae2da2439/api3-dcomp-usdc) - [Api3 Core USDC](https://app.morpho.org/ethereum/vault/0xe2221Aa07ec3266DA87763E2b1e28d07A8a4e53b/api3-core-usdc) - [Kabu USDC](https://app.morpho.org/ethereum/vault/0x54210d3f1A066413891AF9E17210E787d5C6e3f4/kabu-usdc) The vaults combine OEV-boosted yields with first-party oracle data and now include always-on security monitoring as an additional protective layer beyond Api3's existing curation and oracle security measures.