Express Relay, the newest product from Pyth Network, a provider of real-time market data for blockchain applications, has been formally released on the mainnet. The launch presents a revolutionary decentralized solution to the long-standing issue of Miner Extractable Value (MEV) in processing transactions in DeFi that improve market efficiency and liquidations, which was previously believed to be an unavoidable feature of on-chain finance.
The Express Relay primitive uses protocol-controlled auctions for valuable transactions, such as liquidations, to directly link DeFi protocols with a network of established searchers. Searchers like Flow Traders, Wintermute, Auros, Flowdesk, Caladan, Tokka Labs, and Swaap Finance are among many that have already integrated with Express Relay.
Michael Lie, Global Head of Digital Asset of Flow Traders stated:
“Liquidations are inherently difficult to execute effectively. With the introduction of Pyth Express Relay, a new protocol is accessible to enable efficient and seamless execution of liquidations. Market makers such as Flow Traders can provide deep liquidity to the markets during moments of liquidation. When we seek our ecosystem partners to collaborate with, we aim to have an active role in furthering our mission to create more efficient markets. Therefore, we are thrilled to be part of this new initiative and further our engagement with Pyth, which is now many years in the making.”
The term “MEV” describes how miners or validators use blockspace tips to extract the majority of the value from searchers’ DeFi protocol transactions. When using Express Relay, the transaction is carried out by the searcher who makes the most competitive offer. It eliminates miners from the equation in this manner. Then, searchers may engage in more intense competition for the transaction value, and the liquidation reward incentives offered by DeFi protocols can be increased. By ensuring larger savings for protocols, Express Relay contributes to a more equitable DeFi sector. These savings may then be passed on to consumers or used for more productive initiatives.
Tim Wu, Head of DeFi of Wintermute stated:
“Express Relay is a natural progression from Pyth’s core oracle production. It ambitiously serves to reduce value extraction by intermediaries and improve liquidation execution efficiency, effectively tackling this form of MEV. Contributing to a system where searchers and protocols interact with aligned interests furthers our mission to advance a truly decentralized world with more transparent and efficient markets. We are excited to be part of this initiative.”
DeFi protocols that use Express Relay may remove MEV, which refers to miners’ extractive role in arranging transactions, significantly reducing the costs of important processes such as establishing liquidation rewards (the discount offered to searchers to sell underwater positions). To mitigate the effects of MEV, many protocols have already integrated or are in the process of integrating with Express Relay, including Synthetix, Zerolend, Ionic, Synonym, Keom, Jax Finance, Vela Exchange, and Fulcrom Finance. The combined total locked value of these apps across 11 blockchains is $1 billion.
Ryker, Founder of ZeroLend stated:
“Zerolend is proud to integrate with Express Relay to bring MEV-free transactions to our platform. This collaboration enhances our commitment to providing a secure and efficient lending experience that passes down savings to our users.”
Enhanced DeFi Transaction Efficiency
DeFi protocols and searchers may integrate with Express Relay in a permissionless way with only a few lines of code, based on the decentralization ethos.
Matt Losquadro, Core Contributor at Synthetix stated:
“Integrating with Express Relay enhances our ability to provide deep liquidity for on-chain derivatives. By leveraging Express Relay’s auction system, Synthetix can streamline liquidations and optimize capital efficiency, further strengthening our perpetual futures markets. This collaboration aligns with our mission to power robust, reliable derivatives trading in DeFi.”
With Express Relay’s well-established searcher network, new protocols may accelerate their deployment. Protocols may save capital and resources by integrating with Express Relay instead of building their own liquidator and searcher networks from scratch. Express Relay aggregates liquidation and other valuable DeFi transaction opportunities across many blockchains and protocols, for searchers. This arrangement saves time and money by removing the need to negotiate and integrate with certain procedures in order to take advantage of these opportunities.
Douro Labs and Pyth Data Association, two Pyth Network contributors, initially presented Express Relay in public at the first Pyth Agora 2024 summit on July 11 during the Ethereum Community Conference. The Pyth DAO owns and governs the Express Relay primitive.