API3 is excited to announce a strategic pivot in the development of the OEV Network to building on Arbitrum Orbit. This decision was driven by our commitment to delivering the most effective and efficient onchain solution for recapturing oracle extractable value (OEV) for lending protocols. Additionally, this move addresses the challenges we faced in speed-to-market, operational costs, and technical complexities encountered during the initial phase of development.
Since we announced that the OEV Network was in the production phase we have been extensively testing the functionality of the OEV Network to ensure it meets the demands of a competitive, efficient market for oracle updates. Our aim for the OEV Network is not to simply provide a solution to recapturing OEV for lending protocols, but to build the best solution and one that is aligned with core blockchain values. Our goal is to build an onchain execution environment for order-flow auctions to ensure the security, transparency, and accountability of the auction process.
The OEV Network will be the first Layer 2 network where oracle service providers and lending protocols come together to combat the negative impact of maximal extractable value (MEV) through specialized order-flow auctions for oracle updates. The OEV Network creates an efficient market around oracle updates, allowing searchers to bid for valuable price updates, like in the case of liquidations. The proceeds from these auctions are then programmatically returned back to the dApp that generated the value.
We have transitioned to using Arbitrum Orbit as the backend infrastructure to guarantee execution, uptime, and scalability of the OEV Network. This Layer 2 solution provides searchers an open, permissionless, competitive execution environment for a truly secure and onchain order-flow auction.
Arbitrum Orbit enables the permissionless launch of Layer 2 or Layer 3 chains, utilizing the Arbitrum Nitro Tech Stack. This advanced framework enables the OEV Network to leverage the latest in blockchain scaling technology. After much testing, it became clear that Arbitrum Orbit was the best choice for ensuring the reliability and scalability of the OEV Network.
By leveraging Arbitrum Orbit, the OEV Network is set to redefine the oracle landscape around oracle services that are integrated with solutions to recapture protocol MEV. We are proud to push the boundaries of what’s possible using blockchain technology and look forward to the imminent rollout and success of the OEV Network.
For more information on the OEV Network and our new capabilities with Arbitrum Orbit, please visit our website or consult our technical documentation, read the OEV litepaper, or visit the API3 Market to start utilizing the API3 Oracle Stack.
About Arbitrum Orbit
Arbitrum Orbit is the permissionless path for launching customizable Layer 2 (L2) or Layer 3 (L3) chains using Arbitrum technology. Orbit Chains are deployable, configurable instances of the Arbitrum Nitro tech stack, and settle to any Ethereum L2, such as Arbitrum One. With Orbit, you can configure numerous components of the chain such as throughput, privacy, gas token, governance, precompiles, data availability layers and more. To date, over 50 blockchains are operating in the Arbitrum Orbit ecosystem, taking advantage of the customizable offering to fit the precise needs of their project and community.
