Bounty for LP Token / Solvers Integration

CoW Grants Program
1

Summary
We are proposing a grant of 1k USDC/DAI per week, which will be paid out to each solver who responds to at least 90% of LP token sell quotes and 90% of LP token orders. The grant lasts for at most 5 weeks and may terminate earlier if the allocated budget of 20k USDC/DAI is fully utilized. To supplement this, the core team will ensure that a sufficient number of relevant quote requests and orders will be created.

Introduction
With the launch of Uniswap v4 and Balancer v3, we expect many people to remove/add/migrate their liquidity from various AMMs. The process of doing so can be cumbersome, and we think CoW Protocol can provide value (and capture volume) by providing a seamless way to trade LP tokens. We also would like to make it easier for liquidity providers to contribute and remove liquidity from CoW AMMs.

Improving solversā€™ support for LP tokens will unlock new ways for users to seamlessly move & provide liquidity, including:

  • Creating a new LP position with the click of a button, without holding the requisite tokens in their wallet
  • Moving existing liquidity from one pool to another (even to a different AMM) with a single transaction
  • Creating ā€œnestedā€ pools (i.e. CoW AMM pools that hold LP tokens of other pools), allowing a user to implement a diversified, constantly rebalancing, ETF-like strategy simply by buying the LP token of a top-level nested pool

These - and other innovations we have planned - have the potential to make CoW AMM the easiest and most flexible venue for liquidity provision across all of DeFi.

To make this a reality, we want to support LP tokens not just from CoW AMM and Uniswap v2, but all main protocols.

Bounty Specifications
The bounty will start on the 8th October at 00:00 UTC and will run for 5 weeks. The bounty will end on Monday the 12th of November at 00:00 UTC or when the 20k USDC/DAI cap has been reached, whichever happens first. Eligibility for the weekly rewards will be measured by looking at all sell quote orders and orders involving the specified LP tokens for that week starting that week on Tuesday at 00:00 UTC and ending at 00:00 UTC on the Tuesday of the following week.

All solvers that respond to at least 90% of sell quote orders for the specified LP tokens during this period and who also submit solutions for at least 90% of orders involving these specified LP tokens will be eligible for a reward of 1k USDC/DAI for that week.

This reward is not dependent on competitiveness in the solver competition, meaning that all solvers are eligible for the weekly reward of 1k USDC/DAI regardless of how competitive they are or how many auctions they win.

In order to facilitate this bounty the core team will ensure that a sufficient number of relevant quote requests and orders will be created.

Scope

  • All LP tokens on Uniswap V2, Balancer, SushiSwap, and PancakeSwap, Nested CoW AMMā€™s, Curve
  • Mainnet, Gnosis Chain and Arbitrum
3 Likes
2

Curve has ā€˜unburntā€™ fees in the form of LP tokens stuck here: Curve.fi: Fee Receiver | Address 0xa2bcd1a4efbd04b63cd03f5aff2561106ebcce00 | Etherscan

these include LP tokens from spectra.finance (which uses Curve underneath).

This would be a good start.

1 Like
3

I like the proposal in principle, however, what is the plan after 5 weeks and the budget exhausted? How does this incentivise long term value for the DAO?

4

In order to make it easier for solvers to integrate this bounty we would like to propose two changes to this bounty:

  1. Rewards of $1.000 per week will be split across the three chains that weā€™re looking to operate on. Solvers that respond to at least 90% of sell quote orders for the specified LP tokens during this period and who also submit solutions for at least 90% of orders involving these specified LP tokens will receive: $500 for meeting these requirements on Mainnet, $250 for meeting these requirements on Arbitrum, and $250 for meeting these requirements on Gnosis chain. These rewards are independent of each other. So if a solver only integrates LP tokens on Mainnet and meets the requirements there, then they will receive $500 for that week. If they integrate on Arbitrum and Gnosis but not on Mainnet, then they will receive $250+$250 for that week.
  2. We would like to push back the start date and end date by 1 week. Making the new start date of the bounty the 15th of October and the new end date of the bounty the 19th of November.
5

After the 5 weeks are over there will be two main benefits to the DAO.

First, we will have support for trading LP tokens on the CoW Protocol. At the moment, if I want to migrate liquidity from one AMM to another then I have to remove remove liquidity, swap tokens, and then add liquidity. With support for LP tokens you could do this in one operation on CoW Swap and solvers will find the most efficient route.

Second, we would be able to develop nested CoW AMMs. These are AMMs that hold LP tokens instead of regular ERC-20 tokens.

1 Like
6

IMO, It should be made explicitly clear to bounty participants that payment will be made on Gnosis Chain to reduce complexity on the administrative side of payment.

4 Likes
7

Hereā€™s the final bounty that we will post to the snapshot tomorrow:

Summary
The total allocated budget is defined to be 20k USDC/DAI, and the grant should last for 5 weeks, and might terminate earlier if the allocated budget is fully utilized. During this period all solvers that respond to at least 75% of LP token sell quotes and 75% of LP token orders will receive up to 2k USDC/DAI per week. To supplement this, the core team will ensure that a sufficient number of relevant quote requests and orders will be created.

Introduction
With the launch of Uniswap v4 and Balancer v3, we expect many people to remove/add/migrate their liquidity from various AMMs. The process of doing so can be cumbersome, and we think CoW Protocol can provide value (and capture volume) by providing a seamless way to trade LP tokens. We also would like to make it easier for liquidity providers to contribute and remove liquidity from CoW AMMs.

Improving solversā€™ support for LP tokens will unlock new ways for users to seamlessly move & provide liquidity, including:

  • Creating a new LP position with the click of a button, without holding the requisite tokens in their wallet
  • Moving existing liquidity from one pool to another (even to a different AMM) with a single transaction
  • Creating ā€œnestedā€ pools (i.e. CoW AMM pools that hold LP tokens of other pools), allowing a user to implement a diversified, constantly rebalancing, ETF-like strategy simply by buying the LP token of a top-level nested pool

These - and other innovations we have planned - have the potential to make the CoW Protocol the easiest and most flexible venue for liquidity provision across all of DeFi.

To make this a reality, we want to support LP tokens not just from CoW AMM and Uniswap v2, but all main protocols.

Bounty Specifications
The bounty will start on the 15th October at 00:00 UTC and will run for 5 weeks. The bounty will end on Monday the 19th of November at 00:00 UTC or when the 20k USDC/DAI cap has been reached, whichever happens first. Eligibility for the weekly rewards will be measured by looking at all sell quote requests and orders involving the specified LP tokens for that week starting that week on Tuesday at 00:00 UTC and ending at 00:00 UTC on the Tuesday of the following week.

All solvers that respond to at least 75% of sell quote orders for the specified LP tokens during this period and who also submit solutions for at least 75% of orders involving these specified LP tokens will be eligible for a reward of 2k USDC/DAI for that week.

Rewards of $2.000 per week will be split across the three chains that weā€™re looking to operate on. Solvers that respond to at least 75% of sell quote orders for the specified LP tokens during this period and who also submit solutions for at least 75% of orders involving these specified LP tokens will receive: $1.000 for meeting these requirements on Mainnet, $500 for meeting these requirements on Arbitrum, and $500 for meeting these requirements on Gnosis chain. These rewards are independent of each other. So if a solver only integrates LP tokens on Mainnet and meets the requirements there, then they will receive $1.000 for that week. If they integrate on Arbitrum and Gnosis but not on Mainnet, then they will receive $500+$500 for that week.

This reward is not dependent on competitiveness in the solver competition, meaning that all solvers are eligible for the weekly reward of 2k USDC/DAI regardless of how competitive they are or how many auctions they win.

In order to facilitate this bounty the core team will ensure that a sufficient number of relevant quote requests and orders will be created. The bounty will be paid on Gnosis Chain. The CoW team will monitor the competition and retains the right to exclude solvers from the bounty at their own discretion for actions deemed inappropriate.

Scope

  • All LP tokens on Uniswap V2, Balancer, SushiSwap, and PancakeSwap, Nested CoW AMMā€™s, Curve
  • Mainnet, Gnosis Chain and Arbitrum
3 Likes
8

The grant has been posted to snapshot: Snapshot

1 Like