Manifold Finance to Launch a Liquid Collateral Platform: Understanding MEV Extraction and Verifier Sets

On April 4th, it was announced that Manifold Finance will launch a liquid collateral platform in the coming months, which will design mevETH as a liquid collateral derivative that provides additional income through MEV extraction. In order to initiate the agreement, Manifold acquired the verifier set of Cream Finance, which means that those who pledge ETHs in Cream Finance will later mortgage to Manifold’s liquid mortgage agreement. When the agreement is initiated, Manifold will control approximately 25000 ETHs.

Manifold Finance will launch a liquid collateral platform and has acquired the set of validators from Cream Finance

Manifold Finance has recently made an announcement that they will be launching a liquid collateral platform in the coming months. This platform will be designed to create mevETH which is a liquid collateral derivative that provides additional income through MEV extraction. In order to initiate this agreement, Manifold has acquired the verifier set of Cream Finance, which means that those who pledge ETHs in Cream Finance will later mortgage to Manifold’s liquid mortgage agreement. When the agreement is initiated, Manifold will control approximately 25000 ETHs.

What is MEV Extraction?

MEV extraction, or Miner Extractable Value, is the additional income generated by miners during the process of validating and adding blocks to the blockchain. These miners can include transactions in their blocks that result in profits for themselves. The MEV is a measure of the potential value that miners can extract from these transactions.
In the context of Manifold Finance’s liquid collateral platform, mevETH is designed to capture the MEV of Ethereum transactions and create an asset that can be used as collateral. This means that mevETH provides an additional source of income for ETH holders who pledge their assets as collateral.

How Does the Liquid Collateral Platform Work?

Manifold Finance’s liquid collateral platform will enable users to pledge their ETH as collateral and borrow mevETH in return. The mevETH can then be traded on exchanges like any other token. The platform will also support decentralized exchanges so that users can swap mevETH for other tokens or ETH.
The platform works by leveraging the verifier sets of other DeFi protocols. Verifier sets are a collection of smart contracts that help secure the protocol by verifying transactions. By owning the verifier set of another platform, Manifold can ensure that any borrowers who pledge ETH as collateral to that platform will have to later mortgage their ETH to Manifold’s liquid mortgage agreement. This means that Manifold will have control over the 25000 ETHs pledged in Cream Finance.

Benefits of the Liquid Collateral Platform

Manifold’s liquid collateral platform and mevETH derivative provide several benefits for users. Firstly, by pledging their ETH, users can earn additional income through MEV extraction. Secondly, mevETH is a liquid asset that can be used as collateral or traded on exchanges. Thirdly, the platform leverages the verifier sets of other DeFi protocols to secure the platform and ensure the safety of user funds.

The Future of Manifold Finance

Manifold Finance’s liquid collateral platform and mevETH derivative demonstrate the innovative solutions that can be created through DeFi. MEV extraction is an underutilized source of income for ETH holders, and Manifold Finance’s platform provides a unique way to capture this income stream. The acquisition of Cream Finance’s verifier set also showcases Manifold’s commitment to gaining control over the verification of DeFi protocols. It will be interesting to see how Manifold Finance’s innovations in DeFi will shape the future of the industry.

Conclusion

Manifold Finance’s announcement of their liquid collateral platform and mevETH derivative is an exciting development in the world of DeFi. The platform provides a unique opportunity for ETH holders to earn additional income through MEV extraction while also creating a liquid asset that can be used as collateral or traded on exchanges. By leveraging the verifier sets of other protocols, Manifold is creating a secure and innovative DeFi solution.

FAQs

Q. What is MEV extraction?
A. MEV extraction is the additional income generated by miners during the process of validating and adding blocks to the blockchain.
Q. How does Manifold Finance’s liquid collateral platform work?
A. The platform allows users to pledge their ETH as collateral and borrow mevETH in return. The platform leverages the verifier sets of other DeFi protocols to ensure the safety of user funds.
Q. What are the benefits of the liquid collateral platform?
A. The platform provides an additional source of income for ETH holders, creates a liquid asset that can be used as collateral or traded on exchanges, and provides a secure DeFi solution.
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