A walkthrough of a demo Oval application that shows how Oval disrupts the MEV supply chain.
We've created a sample Oval application that mimics a money market (such as Compound or Aave) by creating a mock position that can be liquidated. In this demo the searcher who runs the liquidation bids to backrun an oracle update to execute the liquidation.
Following the transaction flow, one can see:
searcher payment to the builder and their associated profit
builder payment to proposer for the block space
builder payment to the integrating protocol, as part of the kickback
If you're interested in seeing this demo live, reach out to our team to schedule a call here.
Oval Demo Video
Below you can find the Mainnet transactions shown in this demo. They all happen sequentially within the same block, starting at position 0 within the block (top of block).
unlockLatestValue which unlocks the price and is backrun by the liquidator. This is the transaction sent by the Oval Node.
createHoneyPot which is the transaction sent by the user of the front end. This mimics the creation of a liquidatable position. In a typical lending market, this step would typically happen long before the liquidation.
updatePriceFeeds this demo mocks an oracle update. This transaction normally would not be sent by the liquidator, but in this demo, the liquidator is able to force an update.
emptyHoneyPot is the function called by the liquidator to drain the fictitious position created in (2). This mimics a liquidation call.
payBuilder which shows the searcher paying the builder for the right to use the blockspace. Note that in this call there is a special contract that transfers eth to block.coinbase. This could also be done with the priority fee.
builder refund to the integration protocol via the 90% Oval kickback rate. In this transaction, the output funds are sent to a smart contract to hold these funds. In production this would follow the methodology defined in Revenue Sharing.