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Crypto Potato 2024-12-24 07:04:15

Chainlink Unveils MEV Recapture Solution For DeFi, LINK Jumps 9%

On Dec. 23, Chainlink announced a novel oracle solution designed to enable DeFi applications to “recapture non-toxic Maximal Extractable Value (MEV)” called Smart Value Recapture (SVR). Currently, when DeFi protocols use price oracles, such as during liquidations, value is captured by third parties, including searchers and validators. None of this value returns to the protocols or oracles that created these opportunities, however. The solution is SVR, which allows DeFi lending protocol apps to recapture some of this value from liquidations. Chainlink expects to recapture about 40% of the value that would normally be lost. MEV is the profit that can be made by strategically ordering, including, or excluding transactions within a blockchain block. Introducing Chainlink Smart Value Recapture (SVR)—a novel non-toxic MEV recapture solution for users of Chainlink Price Feeds. The initial version was created in collaboration with @bgdlabs , Flashbots, and other contributors to the @aave DAO. https://t.co/EMtJHqRxaM — Chainlink (@chainlink) December 23, 2024 Aave Partnership on SVR The system creates a parallel set of Chainlink price feeds and uses the flashbots MEV-share for auctions, according to the blog post. It also includes a fallback mechanism for safety using standard price feeds and requires minimal changes for protocols already using Chainlink oracles. SVR will generally split captured value at 60% to DeFi protocols and 40% to Chainlink; however, under a special launch partner deal with Aave, it will split it 65:35 for the first six months. Chainlink community ambassador Zach Rynes, aka ‘ChainLinkGod,’ said it was a very bullish development, adding: “Liquidation MEV in DeFi is measured in the tens of millions of dollars per year, presenting a significant economic opportunity for both communities.” He continued to state that SVR is also planned to be one of the first Chainlink services to plug into the Payment Abstraction system, “enabling the Chainlink Network share of the split to be converted into LINK using existing DEXs.” Very bullish development for $LINK and $AAVE with the introduction of @Chainlink ’s new non-toxic MEV recapture solution Chainlink SVR (Smart Value Recapture)—designed to recapture liquidation MEV in DeFi—will feature a revenue split between integrating DeFi protocols and the… pic.twitter.com/sSTabhrH8c — Zach Rynes | CLG (@ChainLinkGod) December 23, 2024 LINK Price Reaction Chainlink’s native token, LINK , was boosted around 9% by the announcement, climbing from just over $22 to reach an intraday high of $24.78. The asset had pulled back slightly at the time of writing but was still trading above $24. LINK remains down 54% from its May 2021 all-time high of $52.70. AAVE prices benefitted even more from the partnership, surging more than 15% on the day to top $380 at the time of writing. The DeFi asset has hit its highest price since September 2021 but remains down around 43% from its May 2021 all-time high of $662. The post Chainlink Unveils MEV Recapture Solution For DeFi, LINK Jumps 9% appeared first on CryptoPotato .

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