AAVE is exploring the integration of Chainlink’s oracle to recover maximum extractable value (MEV) from liquidations. This strategy intends to redirect profits towards the AAVE ecosystem, enhancing user compensation in decentralized finance transactions.
Chainlink recently launched its Smart Value Recapture service, aimed at capturing MEV for DeFi protocols. AAVE’s proposal anticipates that this integration could reclaim around 40% of profits from liquidation processes for the AAVE DAO.
As block builders exploit MEV by reordering transactions, this results in losses for users. AAVE’s initiative, supported by Chainlink, seeks to empower users by reclaiming profits and creating a fairer DeFi environment.