Aave announced the integration of Chainlink SVR Smart Value Recovery to establish a fairer economic model.

Aave integrates Chainlink Smart Value Recapture (SVR) on the Ethereum Mainnet ( to improve value recovery rates. This integration develops a new unique standard for decentralized finance applications, enabling searchers to search for the maximum extractable value (MEV) related to Oracle Machines that was previously leaked, returning value to end users and protocol parties.

What is Chainlink Smart Value Recovery SVR?

Chainlink SVR is collaboratively developed by contributors from BGD Labs, Flashbots, and Aave DAO. Chainlink Smart Value Recapture integrates the Chainlink Oracle network with Flashbots' MEV-Share service. SVR adopts a "dual aggregator" design to enhance redundancy. SVR allows dApps to retrieve the maximum extractable MEV through Price Feeds.

Chainlink SVR is the first Chainlink service connected to payment abstraction. Payment abstraction is a cross-chain payment system that reduces payment friction in the Chainlink network by automatically converting service fees into LINK through the use of Chainlink services (CCIP, automation, price feedback) and decentralized exchanges. The fee portion of the SVR Chainlink Network will be converted into LINK and provided to Chainlink Network service providers.

The significance of improving value recovery rate

In the past, the OEV generated when liquidating under-collateralized loans in DeFi lending protocols was typically taken by participants constructing the block. The integration of Aave and Chainlink SVR allows Aave to reclaim the liquidated MEV and return it to stakeholders, thereby increasing revenue and establishing a fairer economic model.

The Chainlink and Aave communities will share the profits from SVR.

Chainlink SVR recovers the MEV from Aave's liquidation, with initial products including tBTC, LBTC, AAVE, and LINK, and plans to expand to more in the future. The OEV earnings recovered by Chainlink SVR will be distributed between the Chainlink and Aave communities. In the initial six months, the Aave ecosystem will receive a 65% discount rate, while the Chainlink ecosystem will receive a 35% discount rate.

BGD Labs co-founder Ernesto Boado stated that optimizing the clearing algorithm on DeFi while ensuring the financial and technical security of the protocol is a daunting task. The integration of Aave and Chainlink represents a significant advancement for DeFi, not only bringing new revenue sources to Aave but also laying the foundation for the sustainable development of the entire DeFi ecosystem. Chainlink SVR plans to upgrade in the future to enhance decentralization, improve gas efficiency, and provide cross-chain functionality, among other features.

This article announces Aave's integration of Chainlink SVR smart value recovery, establishing a fairer economic model. It first appeared in Chain News ABMedia.