TLDR;
In the rapidly evolving world of DeFi, CoW Protocol and its community have made notable strides, driven by the force of the GrantsDAO. This article provides a comprehensive overview of some of the most significant projects that the GrantsDAO (reelected in January 2023) has successfully funded and completed.
These initiatives, ranging from feasibility studies to protocol enhancements, demonstrate the commitment of CoW Protocol’s community to fostering innovation, enhancing transparency, and driving efficient value distribution within the DeFi space.
Let’s take a detailed look at the grants we funded in the second half of the period. The first half is covered in part 1.
Andrew, Evan, and Mohammed proposed the grant “Surplus-capturing AMMs — a feasibility study” which successfully addressed a prevailing issue in the constant function market maker (CFMM) model. The issue revolved around surplus value captured by arbitrageurs and Maximal Extractable Value (MEV) searchers, often disadvantaging users and liquidity providers (LPs).
The team proposed a distinctive automated market maker (AMM) design that would custody its own liquidity while using pricing discovered by CoW Protocol’s solvers. This AMM aimed to provide improved pricing for CoW users and yield for LPs from passive liquidity provision without the usual exposure to adverse selection.
The project, which ran over a 6–8 weeks timeline, was fully funded by the GrantsDAO, and the team successfully completed their research. They developed a high-level candidate architecture for the “surplus-capturing” AMM and a quantitative model of the additional value that could be delivered to LPs and users.
The final deliverable was a comprehensive technical report and a GitHub repository containing the code used for the studies. The completion of this grant marked a significant step forward in refining the dynamics of AMM designs and highlighted ways AMMs can be improved.
In a successful initiative by @itsahedge, the GrantsDAO funded the creation of a CoW Protocol Golang SDK/client and a CoW Protocol TWAP/DCA CLI bot/app. This project aimed to simplify the integration of CoW Protocol into Go applications, providing developers with a ready-to-use client and eliminating the need to create their own API.
The grant was structured in multiple milestones, with the first, the CoW Protocol Golang SDK/client (funded at $10k) delivered in two installments. Upon completion, the grantee delivered a comprehensive Golang SDK with documentation and example implementation code. This completed project now paves the way for future applications and tools within the CoW Protocol ecosystem, fostering its continued growth.
Undertaken by mfw78, this grant implemented advanced TWAP order types for CoW Protocol via EIP-1271 smart contract orders. This unique feature in the DeFi market enhances CoW Protocol’s utility and increases order concentration.