Greetings, everyone! We want to let the community know about a significant development: Balancer agreed to lower their fees on trade coming from CoW Swap (you can check the rationale and some of the technical details here). The fee discount is significant (80%) and, to start, it applies to the following pools:
To benefit from this opportunity, Sovers must upgrade their current infrastructure to include a pre- and post-interaction with the pool (again, see the first link for details). Therefore, we want to create the right incentives to make the required changes.
We propose to create a bounty scheme financed by our grant program. We are considering awarding 4k USCD to the first solver that successfully executes 10 settlements onchain that take into advantage the fee discounts, 2k to the second, and 1k to the third. The scheme ends after 4 weeks. But we are open to feedback and suggestions!
Thanks @AndreaC!
This is exciting and I’m in favor of providing such incentives.
The CoW Grants program can issue xDAI payments on Gnosis Chain.
I propose that in the end of the four week period the concluding data will be published including a request for retroactive bounty together with Gnosis Chain addresses of the winning solvers.
If additional committee members indicate their support, we can assume that payments will be issued when the competition concludes, in response to a formal summary here on the forum (and subsequent snapshot).
Reduced fees for settlement on CoW Protocol is definitely advantageous for CoW.
In order to price this appropriately, have solvers been able to comment on the approximate amount of hours / additional work that would be required for this to be implemented? Also, how much order flow is this anticipated to effect (ie. potential reward for CoW Protocol).
As the requirements for continual improvement to maintain competitiveness is somewhat fundamental to the solver competition, I’m hesitant about setting precedent for providing additional incentives in addition to the batch reward.
@middleway.eth : you are fully correct! I was a bit sloppy in describing the proposal, but in practice it will work exactly the way you describe (and it is indeed DAI not USDC)
@mfw78 let me give you a bit of context (which was lacking in my initial message). We see this integration as a first step toward a potentially deep collaboration between us and Balancer. For example, see the result of this research grant (there is some additional internal research on how you could integrate a batch with an AMM that we will release soon). The Balancer team moved extremely rapidly precisely because they understood this as a first step to a longer journey.
You are correct that competition between solvers should be enough to eventually start using the Balancer’s discount. The problem on our end is speed: we would like them to start doing it quickly to move rapidly to the next collaboration stage. This is also why we did not calculate this reward based on costs: the rewards are not meant to provide the incentives (as you said, there is the competition for that); they are meant to be a nudge to do that quickly. Finally, we did not base our proposal on an estimated order flow to those specific pools.