CIP-15: Reimbursement of Solver Bond & Transfer of ownership

CIP: 15
title: Reimbursement of Solver Bond & Transfer of ownership
author: Luis Machado (luis@cow.fi)
status: Voting
created: 2022-10-21

Simple Summary

This CIP asks that CoW DAO becomes the official owner of the Solver Bond (0x5d4020b9261F01B6f8a45db929704b0Ad6F5e9E6) and reimburses Nomev Labs USDC 500,000, and reimburse the funding wallet $COW 1,500,000. Nomev Labs will continue to be responsible for running the bonding pool.

Motivation

Following the approval of CIP-7: Allowing External Solvers, the Nomev Labs Lda team (previously, “Cow Services, Lda”) proceeded to advance funds to set-up a bonding pool (wallet 0x5d4020b9261F01B6f8a45db929704b0Ad6F5e9E6), managing it on behalf of the CoW DAO.

The solver bond acts as an insurance policy for the CoW Protocol and its users against malicious behaviour of solvers. Solver competition is a crucial piece in the decentralisation of the protocol. Given that the significant capital investment for the bonding facility could create a barrier to entry, Nomev Labs advanced funds and manages the vetting and allow-listing of some solvers. Given that the operation is now running smoothly, Nomev Labs is requesting the reimbursement of this amount.

These funds were not budgeted for in CIP-6: Service Agreement. If left with the current set-up, it would increase Nomev Lab’s tax burden significantly: a contingent liability is not a tax deductible cost, raising a corporate tax liability of over to EUR 200,000, implying a reduction of near 1 month runway of the development company’s operation.

As such, this CIP asks that CoW DAO officially becomes the owner and “insurer” of this bonding pool (to remain at 0x5d4020b9261F01B6f8a45db929704b0Ad6F5e9E6), refunding the USDC 500,000.00 and $COW 1,500,000.00 back to the respective source wallets, originally transferred on 2nd of May, 2022.

It will continue to be Nomev’s obligation as part of the Service Agreement to run the bonding pool on behalf of CoW DAO.

Proposal

That the CoW DAO transfers the solver bond funds back to the to the funding wallets at:

USDC 500,000.00 - Wallet 0x1E93f91e38deE64339cFbED29EF6EE51D188E7fF (*)
$COW 1,500,000.00 - Wallet 0xca07EaA4253638D286caD71CBcEec11803F2709A

From the following wallets owned by CoW DAO

USDC funds - Wallet 0xA1cb7762F40318ee0260F53e15De835fF001cb7E
$COW funds - Wallet 0xcA771eda0c70aA7d053aB1B25004559B918FE662

(*) note that this solver pool has cUSDC to obtain interest.

3 Likes

Voting is already live at:
https://snapshot.org/#/cow.eth/proposal/0x5005d4e708526e3a9f16e49261575b87c7d5f4f5a4bc1c7592187db0864ba7be