### Author:  [@mikeb](https://forum.cow.fi/u/mikeb)
#### Post date: [January 30, 2025, 3:19am UTC](https://forum.cow.fi/t/cip-69-balancer-x-cowswap-strategic-alignment-tokenswap/2803/1 "2025-01-30T03:19:54Z")
```
CIP-Number:
title: Balancer x CoWSwap Strategic Alignment Tokenswap
author: @Mike B, @Gosuto
status: Draft
created: 2025-01-27
```
Note: An equivalent proposal has been posted on the Balancer forums [here (link)](https://forum.balancer.fi/t/bip-xxx-balancer-x-cowswap-strategic-alignment-tokenswap/6319)
# Balancer x CoWSwap Strategic Alignment Tokenswap
## Simple Summary
This CIP proposes that Balancer DAO and CoW DAO initiate a BAL/COW tokenswap of the amount 200k BAL and ~631k COW in order to further align incentives as we approach the next stage of CoWAMMs.
## Motivation
Back in August 2024, through a collaborative effort, Balancer and CoWSwap debuted CoWAMM’s– the first LVR reducing AMM on the market. This represents the latest iteration in the long line of BAL/COW partnerships, with the first instance going back to soon after CoWSwap’s launch when Balancer integrated CoWSwap on the main swap UI. Balancer allocated $250k worth of BAL to be used as discretionary incentives in CoWAMM’s. AMM’s and intent networks go hand and hand and we expect there to be more collaborations in the future, particularly in regards to expanding on the mechanisms of CoWAMM’s. Balancer CoWAMM’s have reached over 25m TVL and 50m+ volume.
## Rationale
In [CIP-45 Balancer & Cow Protocol Strategic Partnership – Launching CoWAMM Pools](https://forum.cow.fi/t/cip-45-balancer-cow-protocol-strategic-partnership-launching-cowamm-pools/2457) and [BIP-628 - Balancer & Cow Protocol Strategic Partnership – Launching CoWAMM Pools](https://forum.balancer.fi/t/bip-628-balancer-cow-protocol-strategic-partnership-launching-cowamm-pools/5813), a token swap was outlined but was never executed upon in order to not distract from the CoWAMM launch.
**This proposal seeks to formalize and execute a tokenswap between the two DAOs in order to further align incentives as we begin the next stage of CoWAMM development**. This proposal not only further aligns both DAO’s but gives CoW DAO the potential firepower to drive incentives to CoWAMM pools.
## Specification
The details of the swap are as follows:
**200k BAL for an equivalent amount of COW based on a 30d TWAP sourced from Coingecko**
As of 01/15/2025, this comes out to
- 200k BAL @ 2.696104254 = $539,220.8508
- 631850.824075 COW @ 0.8533989832 = $539,220.8508
Data: [Cow Bal twap - Google Sheets](https://docs.google.com/spreadsheets/d/1Tctm2vP_udCU3mUwN7XxDl7UKJgMOkMAT8Gd7k5OoZ0/edit?gid=1310730721#gid=1310730721)
These tokens are not to be sold for a minimum of 2 years, but are eligible to participate in any native governance/staking mechanisms created by the respective DAO’s.
- CoW DAO may deposit their BAL into veBAL and use it for directing incentives to CoWAMM pools. However, CoW DAO must supply the 20% portion of ETH required to deposit into the 80/20 pool which is used to lock for veBAL.
- Balancer may use COW to participate in governance and to be used to post bond for a Balancer run solver on the CoWSwap network (although there are no immediate plans to do so).
The mechanism used for this swap will be identical to the Balancer x AAVE tokenswap from [this proposal](https://forum.balancer.fi/t/proposal-strategic-partnership-with-aave-dao/3031) using an instance of the OtcEscrowApprovals contract (with addresses and amounts swapped out) located [here](https://github.com/llamaxyz/bal-aave-token-swap/blob/main/contracts/OtcEscrowApprovals.sol).
The way this contract works is upon deployment, the two recipients and amounts are set. Each DAO then approves the exact amount to the contract and then someone calls the swap() function and the amounts will be transferred from each dao into the opposite dao’s treasury. Either both swaps happen or nothing happens at all.
At the request of CoW DAO contributors, a change was made to the swap contract to allow the source of the COW tokens to be separate from the destination of the BAL tokens. The COW will be sent from `0xcA771eda0c70aA7d053aB1B25004559B918FE662`
and the resulting BAL will end up in `0x3E2897E71E504B0510Bed7983579280b32ac1CA5`.
## Github PR
An updated contract with all the parameters is deployed here: [Address: 0xdBe554ee...bDF0e8B54 | Etherscan](https://etherscan.io/address/0xdBe554ee86FEb0b1c0ac4743503D46cbDF0e8B54) and its repository can be found here: [https://github.com/BalancerMaxis/bal-cow-token-swap](https://github.com/BalancerMaxis/bal-cow-token-swap)
## Transaction Data
In order to execute the tokenswap, both DAO’s must approve the proper amounts of tokens to the tokenswap contract.
```
Balancer DAO mainnet multisig will call approve on the BAL token contract address at 0xba100000625a3754423978a60c9317c58a424e3D with the following params:
Amount: 200000000000000000000000
Spender: 0xdBe554ee86FEb0b1c0ac4743503D46cbDF0e8B54
CoW DAO will call approve on the COW token at 0xDEf1CA1fb7FBcDC777520aa7f396b4E015F497aB from the multisig at 0xcA771eda0c70aA7d053aB1B25004559B918FE662
amount: 631850824075366674282674
Spender: 0xdBe554ee86FEb0b1c0ac4743503D46cbDF0e8B54
```
Once this is done, anyone can permissionlessly call swap() on the token swap contract to execute the treasury swap.
**Transactions will be executed on CoW DAO’s Safe using the oSnap plugin, contingent upon successful passing of this CIP. When voting on Snapshot, participants are encouraged to verify the content, cross-check Tenderly simulations, and confirm alignment with the CIP’s intent.**
## Tenderly Simulation
> **[Simulated Transaction | Tenderly](https://www.tdly.co/shared/simulation/1fd40bb7-d638-456f-8b0d-407bf53a6153)**
>
> Simulated transaction overview for the 0x366cf9392cd87dfa6b704542b102109631e9d223f5b982e1234673b2d7f798d8 on Mainnet network. See full details on Tenderly Dashboard.
This simulation overrides state to give the make the above allowances from each respective multisig and call `swap()` on the swap contract at `0xdBe554ee86FEb0b1c0ac4743503D46cbDF0e8B54`
## Conclusion
The Balancer x CoWSwap collaboration has been one of the longest running collaborations in Defi and both teams are excited to bring about the next iteration of CoWAMM’s. This proposal helps further align both DAO’s and gives CoW DAO the ability to drive incentives to the upcoming next generation of CoWAMM’s.
---
### Author:  [@Tane](https://forum.cow.fi/u/Tane)
#### Post date: [February 5, 2025, 9:37am UTC](https://forum.cow.fi/t/cip-69-balancer-x-cowswap-strategic-alignment-tokenswap/2803/2 "2025-02-05T09:37:15Z")
We think CoWAMM has the potential to become a significant revenue source for CoW DAO, and deepening the partnership with Balancer seems strategically sound.
What we would like to clarify is whether the previously allocated $250k worth of BAL incentives for CoWAMMs has already been fully utilized or if any remain, and whether Balancer can provide additional incentives going forward.
> Balancer allocated $250k worth of BAL to be used as discretionary incentives in CoWAMM’s.
> [[BIP-770] Balancer x CoWSwap Strategic Alignment Tokenswap - Governance - Balancer](https://forum.balancer.fi/t/bip-770-balancer-x-cowswap-strategic-alignment-tokenswap/6319)
Also, we are interested in how CoW DAO plans to leverage veBAL to direct rewards to specific CoWAMM pools. A targeted approach to building deep liquidity and driving volume in selected pools might be highly beneficial, while we’ve got many pools with different assets of CoWAMM.
---
### Author:  [@mikeb](https://forum.cow.fi/u/mikeb)
#### Post date: [February 6, 2025, 3:10pm UTC](https://forum.cow.fi/t/cip-69-balancer-x-cowswap-strategic-alignment-tokenswap/2803/3 "2025-02-06T15:10:44Z")
Balancer still has roughly half of the BAL incentives left to continue incentivizing CoWAMM’s and will be using these to bootstrap the next version of CoWAMM’s. It’s also possible we provide additional incentives through some DAO controlled discretionary incentives once CoWAMM’s are part of our gauge system.
---
### Author:  [@gosuto](https://forum.cow.fi/u/gosuto)
#### Post date: [May 22, 2025, 10:28am UTC](https://forum.cow.fi/t/cip-69-balancer-x-cowswap-strategic-alignment-tokenswap/2803/4 "2025-05-22T10:28:43Z")
we would like to propose to finalise this CIP and move it to snapshot
---
### Author:  [@middleway.eth](https://forum.cow.fi/u/middleway.eth)
#### Post date: [June 3, 2025, 9:58am UTC](https://forum.cow.fi/t/cip-69-balancer-x-cowswap-strategic-alignment-tokenswap/2803/5 "2025-06-03T09:58:52Z")
The proposal has met all the requirement to be moved to the voting phase.
Posting on CoW DAO’s snapshot requires holding 10k COW to mitigate spam, open to anyone interested in moving a CIP to snapshot.
The TWAP and resulting numbers are a bit outdated, wonder if you wanted to update them before posting the CIP for voting?
---
### Author:  [@gosuto](https://forum.cow.fi/u/gosuto)
#### Post date: [June 4, 2025, 10:30am UTC](https://forum.cow.fi/t/cip-69-balancer-x-cowswap-strategic-alignment-tokenswap/2803/6 "2025-06-04T10:30:20Z")
the contracts with hardcoded amounts have already been deployed months ago ([OtcEscrowApprovals | Address 0xdBe554ee86FEb0b1c0ac4743503D46cbDF0e8B54 | Etherscan](https://etherscan.io/address/0xdBe554ee86FEb0b1c0ac4743503D46cbDF0e8B54#code)), the proposal has already passed governance on the balancer side ([https://snapshot.box/#/s:balancer.eth/proposal/0x32ab0d2e7470cf656fc755501073d9921588ab7e8a43792e6dace0255783945f](https://snapshot.box/#/s:balancer.eth/proposal/0x32ab0d2e7470cf656fc755501073d9921588ab7e8a43792e6dace0255783945f)) and approval has already been granted from treasury
we will post this cip to snapshot asap
---
### Author:  [@KPK](https://forum.cow.fi/u/KPK)
#### Post date: [June 16, 2025, 1:48pm UTC](https://forum.cow.fi/t/cip-69-balancer-x-cowswap-strategic-alignment-tokenswap/2803/7 "2025-06-16T13:48:20Z")
Moved to Snapshot:
[https://snapshot.box/#/s:cow.eth/proposal/0x718291e0719593529657506a0cbd978b174acb51fdde0abff27456a081deedea](https://snapshot.box/#/s:cow.eth/proposal/0x718291e0719593529657506a0cbd978b174acb51fdde0abff27456a081deedea)