According to Cointelegraph, Rebar Labs plans to introduce the first Bitcoin-native platform aimed at shielding traders from Maximum Extractable Value (MEV) strategies
Cryptocurrency technology firm Rebar Labs is working on launching the first Bitcoin-native platform to protect traders from Maximum Extractable Value (MEV) strategies, a report from Cointelegraph revealed on Oct. 19.
The platform, called Shield, is set to go live by the end of 2024. It will be designed to safeguard traders from harmful MEV practices, such as frontrunning, on Bitcoin.
According to CEO Alex Luce, Shield will serve as Bitcoin's version of Ethereum's Flashbots, which has protected an estimated $43 billion in DEX transactions from MEV since 2021, based on data from Dune Analytics.
Luce highlighted the increasing prevalence of MEV, particularly frontrunning, on Bitcoin. He explained that decentralized exchanges (DEXs) and layer-2 scaling solutions (L2s) have brought new energy to the Bitcoin network, but they have also exposed traders to the negative effects of MEV strategies.
The report also noted that Shield will be working to enhance returns for Bitcoin miners, who are responsible for processing transactions and adding them to Bitcoin's blockchain ledger. Luce stated that Rebar is in discussions with several major miners to launch Shield with a significant portion of the Bitcoin network's hashrate.
Bitcoin's 2021 Taproot upgrade opened the door for more advanced activities on the network, such as the creation and trading of other types of tokens and the minting of non-fungible tokens (NFTs). However, Luce pointed out that Bitcoin-native decentralized finance (DeFi) is still in its early stages and is largely limited to crypto-native traders.
Luce noted that the daily trading volume is currently in the millions, which is not substantial. He likened the current state of Bitcoin-native DeFi to an early beta phase with minimal user interaction. The target user base is expected to evolve over the next 12 to 24 months.
Meanwhile, several Bitcoin-native L2s, including Babylon, Core Chain, Rootstock, and Stacks, are gaining momentum. As of Oct. 18, the total value locked (TVL) on Bitcoin's L2s stood at around $2 billion, according to data from DefiLlama.
Luce emphasized the crucial role of good execution on Bitcoin, warning that traders may shift to L2s if the execution on Bitcoin does not improve. He expressed his belief that this would be a missed opportunity, considering Bitcoin's potential as a market.