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 Positions for Oracle Control as Curation Era Approaches
**API3 is positioning itself for dominance** in the emerging curation landscape by focusing on oracle transaction control. The project's **first-party oracle solutions** aim to avoid the competitive race to the bottom that other oracle projects face. This strategic approach differentiates API3 from competitors who rely on third-party data feeds. **Key advantages include:** - Direct data sourcing from APIs - Reduced intermediary dependencies - Enhanced data verification capabilities API3's co-founder has outlined a **hawkish strategy** that leverages their unique positioning in the oracle space. The "curation arc" represents a shift toward more selective, high-quality data provision rather than broad, commoditized oracle services. This positioning could prove crucial as **blockchain applications demand higher data quality** and reliability standards.
API3 Oracle Services Launch on Injective EVM Mainnet Supporting YeiFinance
**API3 announces continued partnership with YeiFinance**, providing comprehensive oracle services on the Injective EVM mainnet from launch day. **Key developments:** - Oracle services include **OEV (Oracle Extractable Value) capture** capabilities - API3 will be **live on Injective EVM mainnet on day one** - Partnership extends existing support for YeiFinance operations The integration brings API3's oracle infrastructure to Injective's EVM-compatible environment, enabling DeFi protocols to access reliable price feeds and capture additional value through OEV mechanisms. *Stay updated on API3's expanding oracle network deployments.*
RLP/USD Oracle Feed Goes Live on API3
**RLP token now has live price feeds** through API3 oracles, providing transparent multi-source pricing across 40+ blockchain networks. **Key details:** - RLP serves as the risk-bearing layer for USR stablecoin - Token holders earn yield by absorbing systemic risk - Available on [API3 Market](https://market.api3.org) This follows the earlier launch of RESOLV/USD feeds in July, expanding Resolv Labs' oracle infrastructure for their DeFi ecosystem.
Morpho Labs and Yearn Finance OEV-Boosted Vault Update
Morpho Labs and Yearn Finance continue their collaboration on OEV (Maximal Extractable Value) recapture through their joint vault initiative. The OEV-Boosted USDC vault has shown significant growth since its launch, surpassing $10M in deposits. Key points: - Partnership focuses on returning value to users - Vault specifically designed for USDC deposits - Plans include expansion to additional markets and chains - Aims to provide sustainable yield opportunities Visit [Morpho's OEV-Boosted Vault](https://app.morpho.org/ethereum/vault/0x68Aea7b82Df6CcdF76235D46445Ed83f85F845A3/oev-boosted-usdc) to learn more.
ETHPrague Conference to Address DeFi Value Recapture Through OEV
The upcoming ETHPrague conference (May 27-29) will feature discussions on Optimistic Execution Value (OEV) in DeFi protocols. The event aims to educate developers and protocol owners about: - Methods to recapture value currently being lost in DeFi operations - Implementation strategies for OEV integration - Revenue enhancement opportunities for protocols The conference follows a successful presentation at ETH Bratislava, where similar topics were explored. Attendees can find representatives for detailed discussions by looking for Api3-branded participants.