Pyth Network launches Express Relay to address the problem of MEV
Pyth Network has launched Express Relay on the mainnet to address the long-standing problems of MEV. The latest product was showcased by Douro Labs and the Pyth Data Association at the EthCC in Brussels on Thursday.
It’s time to take back control and eliminate MEV.
— Pyth Network 🔮 (@PythNetwork) July 11, 2024
Introducing: Express Relay—priority auctions for a more self-sovereign DeFi 🔮
Remove the extractive role of miners, roll out protocols faster, and instantly access a network of top searchers.
Learn more: pic.twitter.com/y2NtH9t0ZP
According to the blockchain market and finance data oracle, Pyth Network, it was stated in a post via X that DeFi protocols are directly connected to a network of well-established searchers through Express Relay. Searchers can compete for priority to carry out profitable operations (like liquidations) on integrated DeFi protocols through this priority auction. Searchers are specialized actors who locate and take advantage of MEV opportunities. In the case of Express Relay, these actors include Flow Traders, Wintermute, Auros, Flowdesk, Caladan, Tokka Labs, and Swaap Finance.
Pyth's core oracle production is a natural step up to Express Relay. It successfully addresses this type of MEV by aiming to lower value extraction by middlemen and boost the efficiency of liquidation execution, according to a statement from Tim Wu, Wintermute Head of DeFi.
How Pyth Network's Latest Product 'Express Relay' plans to eliminate MEV?
Express Relay tackles the issue of MEV, or the profit that validators or miners derive from rearranging, adding, or removing transactions from a block. For DeFi protocols and users, this extraction leads to expenses and inefficiencies. It is inherently challenging to carry out liquidations efficiently, the post added.
Pyth Express Relay has made a new protocol available to facilitate the smooth and effective execution of liquidations, according to Michael Lie, Global Head of Digital Assets at Flow Traders.
Protocols carry out liquidations in the lending sector in order to remain solvent. To complete valuable liquidations, searchers compete for block space. However, protocols frequently overpay, which hurts the user experience and benefits miners and validators the most, the post added.
Aave and Compound (V2, V3) mainnet alone has paid out more than $150 million in liquidation bonuses. Rather than the searchers carrying out the liquidations, the majority has gone to miners—an outcome that is frequently accepted as inevitable.
Resolving these problems can significantly reduce protocol costs, increase market-wide efficiency, and create a more creative DeFi environment. With Express Relay, miners no longer play an extractive role because the sequencing of transactions is decided in auctions governed by protocols.
New protocols need to create their own liquidator networks and bargain with searchers to guarantee reliable liquidations. Additionally, searchers bear the integration costs associated with each protocol they decide to integrate with. There are large opportunity costs for both parties.
Synthetix, Zerolend, Ionic, Synonym, Keom, Jax Finance, Vela Exchange, and Fulcrom Finance are just a few of the protocols that Pyth Network claims have integrated or are in the process of integrating with Express Relay, allowing them to spend less money on bootstrapping their own liquidator and searcher networks. Protocols can easily connect to an existing searcher network to bootstrap liquidations, rather than creating liquidator networks and negotiating with searchers. Express Relay provides searchers with a central location to access valuable transaction opportunities across various DeFi protocols. Without creating custom code for the interface of each protocol, searchers can compete for these opportunities, the post added.
"Our capacity to offer deep liquidity for on-chain derivatives is improved by our integration with Express Relay." Synthetix can further strengthen our perpetual futures markets by streamlining liquidations and optimizing capital efficiency by utilizing Express Relay's auction system," said Matt Losquadro, a core contributor to Synthetix.
Using Express Relay, DeFi Protocols have the ability to maintain extracted value and expedite deployment by utilizing a pre-integrated searcher supply. Furthermore, access to opportunities across integrated protocols is available to searchers, and eliminating miners' extractive roles benefits DeFi users, the post said.
Express Relay connects the needs of increasingly complex DeFi projects with the interests of the community. Live on EVM mainnets, Express Relay is supported by a strong network of searchers and DeFi protocols.
Pyth Network was first created for the Solana blockchain, but it currently functions on more than 50 blockchains, including Ethereum, Optimism, Arbitrum, Base, and Solana. It offers real-time market data for commodities, stocks, FX, and cryptocurrency.
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