API3, a key player in decentralized finance (DeFi), has announced the launch of its OEV Network. This ZK-rollup platform is designed to efficiently capture Oracle Extractable Value (OEV), offering a novel revenue source to DeFi protocols and disrupting traditional oracle services.

In the DeFi ecosystem, where various Web3 service providers play critical roles, OEV has emerged as a vital aspect. API3's OEV Network is set to address the substantial value leakage in DeFi services by capturing and redirecting this value back to the protocols, thereby providing a significant revenue boost.

The OEV Network not only complements API3's first-party oracles but also disrupts the current market dominated by third-party oracles. By distributing a portion of captured OEV to API providers, API3 incentivizes them to directly participate in Web3, encouraging a more equitable data ownership model.

This network functions as a specialized order flow auction platform, where rights to execute specific data feed updates are sold to the highest bidders. Such a system ensures that dApps using API3 data feeds can enable the OEV Network and start generating revenue seamlessly.

Sandeep Nailwal, Co-Founder of Polygon, commended API3's initiative:

“API3's OEV Network is a breakthrough in the DeFi ecosystem, providing a secure, innovative solution for oracle value extraction.”

OEV Network's initial iteration will be a single Validium on the Ethereum mainnet, evolving over time to meet the platform's growing needs. This initiative reflects API3's commitment to building systems that are not only technically sound but also trustworthy and transparent.

Conclusion

With the introduction of the OEV Network, API3 is set to redefine the approach to Oracle Extractable Value in DeFi. This platform promises to enhance the revenue streams of DeFi protocols and foster a more balanced ecosystem for data providers and users alike.

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