Arbiter Roots

  1. Extractable Value exists within various DeFi protocols due to the liquidity deposited within them.

  2. This liquidity is provided by Liquidity Providers (LPs), who are essential to the protocol's operation.

  3. Most of the Protocol Extractable Value is currently captured by external actors, not by the protocol or its LPs.

  4. Despite the fact that Extractable Value arises because of the liquidity provided by LPs, they do not directly benefit from it.

  5. If a protocol could redirect Extractable Value back to its Liquidity Providers, it would offer higher yields and outperform other protocols in terms of liquidity provision.

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