The Uma Protocol native token saw a dramatic price increase after it teased a potential plan for a solution focused on protecting lending protocols from maximum extractable value (MEV).
The Uma token saw a 90% price increase following the announcement, rising from $2 to its current price of $3.80, according to The Block’s Price Page. Uma’s market capitalization has reached almost $300 million, the highest since mid-2022.
Details on the proposed MEV solution, known as Oval, remain limited at this stage. However, Uma has stated that this product will focus on protecting lending protocols. The introduction of this solution is expected next week, according to Uma co-founder Hart Lambur.
MEV is a concept in blockchain technology where those involved in the block production process earn additional income by reordering transactions so that they are suitable for third parties. According to Uma, credit protocols lose significant amounts each year – estimated at tens of millions of dollars – as a result of MEV.
The upcoming launch aims to address this issue as implied by Uma’s statements about regaining lost value. “Every year, credit protocols lose tens of millions of dollars in MEV. It’s time to reclaim that value,” the project said declared on X.
Uma’s existing products
Uma is an Ethereum-based DeFi protocol that focuses on synthetic assets. It operates an optimistic oracle product, which allows users to verify data on-chain through economic incentives and dispute resolution.
Uma’s price increase occurred despite the overall crypto market going through a recession. The total market capitalization has fallen 2.3% in the past 24 hours and is now valued at $1.71 trillion. Bitcoin is currently trading around $41,000, reflecting a slight pullback from its recent upward trajectory.
