CowSwap

Basics

• Based in:
• Started in / Announced on:
• Testnet release:
• Mainnet release:
• Cowswap is a DEX.

Audits & Exploits

• The GPv2/CowSwap Bug Bounty program rewards participating users with up to 50k for bug finds. Program information can be found here (9-2021).
• Scored 90% on DeFi Safety (23-9-2021):

"Activity is 400 transactions a day on contract Gnosis Protocol: GPv2Settlement.

As per the SLOC, there is 73% commenting to code (CtC). GPv2/CowSwap has 97% code coverage according to the coveralls report. No formal verification could be found. Cowswap has been deployed to multiple testnets. One audit was released shortly after Cowswap's deployment, but was started beforehand. While the results are public it is very short at just 3 pages."

• From the Gnosis blog (12-8-2021):

"Today is an important day as CowSwap will upgrade to audited smart contracts that include a tight integration with Balancer’s new vault architecture. This upgrade will mark the evolution of CowSwap from Alpha to its final stable version, its first stable and audited version."

• From their FAQ (14-6-2021):

"CowSwap is in ongoing development, and that is why this is not a beta product but rather a proof-of-concept dapp for the community to test and leverage before the final version is released. The code has been carefully tested, peer-reviewed and fully audited."

Governance

Admin Key

• From DeFi Safety (23-9-2021):

"The documents detailing the planned decentralisation process clearly state the status of access controls. All the core executing contracts are immutable. No pause control can be used on the GPv2/CowSwap core executing smart contracts due to their immutability."

Treasury

The CoW Swap X account announced (24-1-2024) the protocol would start taking 50% of the surplus generated on trades. The surplus is the positive difference between the price quote CoW Swap provides users before they submit a trade and the price the protocol executes it at.

Token

Launch

• vCOW went live on 12-2-2022.

Utility

• From their FAQ (14-6-2021):

"There is currently no plan for a CowSwap specific token. At the moment the value is already captured by the GNO token, as CowSwap is built on top of Gnosis Protocol. If you are curious about how the value is captured, you can read this forum post."

Technology

• Whitepaper can be found here.
• Code can be viewed here. From DeFi Safety (23-9-2021):

"With 1712 commits and 72 branches, Cowswap's development history is beautifully rich and detailed."

Implementations

• Built on: Ethereum, plus it relies on Gnosis Protocol v2’s network of solvers that match orders in five minute batches and then submits the solution on chain (4-6-2021).

How it works

• From Uncommon Core (29-5-2021):

1. "First, you no longer publish a fee-paying transaction to the public mempool. Instead, you sign a transaction and submit it off-chain to the CowSwap relayer, which handles all the execution. For you, this means you can safely set a very low slippage tolerance because you only ever pay a fee if your trade succeeds.
2. Second, and this gets us to real innovation, CowSwap looks for so-called “coincidents of wants” or CoWs before sending your order to the regular on-chain exchanges. For example, if one trader wants to buy ETH at a certain price and another wants to sell it, these two can be matched without paying any LP fees. Off-chain solvers can look at this orderbook and submit optimal matchings that among others, guarantee that all trades in a certain batch have to settle at the same uniform price. Because there’s no point in reordering trades that have the same price, this also eliminates MEV as well.
3. Only after all coincidents have been exhausted, CowSwap sends the rest of the order to the on-chain exchanges via smart routers like 1Inch"

• From their FAQ (14-6-2021):

"Each executed order has a fee which is captured by the protocol. Part of the fee is paid to solvers [on Gnosis Protocol v2] (entities which provide order settlement solutions) to incentivize their participation.

The fee consists of the "base cost to execute the trade" and the "protocol fee" (although it is only exposed to the user as one fee). As a user, you are only signing a message to submit your trade and the underlying solver will end up submitting the transaction for you. Essentially you are paying this "base cost to execute the trade" aka "gas costs" with your sell token and the cost is already included in your price estimation. The protocol is currently subsidizing a portion of the gas costs, while the protocol fee is currently switched off.

Note that you will only have to pay fees IF your trade is executed. No more gas-costs on any failed transactions!"

Upgrades

• From the Gnosis blog (12-8-2021):

"Today is an important day as CowSwap will upgrade to audited smart contracts that include a tight integration with Balancer’s new vault architecture. This upgrade will mark the evolution of CowSwap from Alpha to its final stable version, its first stable and audited version."

Roadmap

• Can be found [Insert link here].

Competition

• CowSwap achieved 11% of aggregator market share (11-2022). 1inch still has 74%.
• From Dose of DeFi (10-12-2022):

"There are a lot of similarities between CoW Protocol and what Flashbots are proposing with SUAVE. CoW is focused on “trading intent expression” while SUAVE intends to capture “generalized intent expression”. This is a fancy way of saying, “What do you want to buy or sell and for how much?” The protocol will then auction off this intent to either solvers (CoW) or builders (SUAVE). The key difference is that SUAVE is designed to extract most of its value from transaction ordering, whereas with CoW, trade order doesn’t matter because all tokens have the same price within a block. The other key difference is that SUAVE is intended as a single place to submit orders for multiple blockchains, though CoW may also move in this direction."

Team, Funding, Partners

Team

• Full team can be found here (9-2021).
• Felix Leupold

Funding

• CoWDAO closed a $23M investment round (5-4-2022).

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