Oracle updates. They can make or break your dApp.

But what if you could recapture the value they create?

Let me introduce a Case Study series on 3 projects exploring OEV (Oracle Extractable Value) and its potential: 🧵

OEV is value that can be extracted due to an oracle updating or not updating. Imagine a liquidation scenario. The oracle updates, your health factor drops below one, you get liquidated. This oracle update? It's worth $100,000. That's how OEV calculations are done today.

Look at the biggest lending protocols in the space: Aave, Compound, Venus. Over their existence, they've lost over 300 million in value. Just from lending protocols. Aave alone lost roughly 50 million this year. Compound, 15. Venus, 7. OEV is a piece of this puzzle.

Early on, DYDX moved to their own chain to internalize all the fees that happen on their platform. Angle had an exclusivity deal with a searcher team, splitting everything 50-50. That's one way to solve MEV internalization.

Unichain is another term you might have heard. It's about keeping the value that dApps create. OEV is no different. Devs are looking for ways to recapture the value they create surrounding Oracle updates.

That's why solutions are being built to recapture that value. UMA Oval released in January. Then came PYTH Express Relay. Each of these solutions has something in common: they're auctioning off priority.

How is that priority created? It differs. But the general idea is you get access to something in a privileged way. That's the crux of these OEV solutions.

OEV is a new frontier for dApp developers. It’s about reclaiming value, and in this Case Study series, we’ll explore @UMAprotocol, @PythNetwork, and @API3DAO.