Crypto Basics

News

Governance

Guides

Product Info

George Hristov

## TL;DR

-   During the month of  **January**, CoW Protocol handled a total volume of  **$1.9B**  and generated a surplus of  **$16.1M**
-   In terms of Governance, CoW DAO executed CIPS  [34](https://snapshot.org/#/cow.eth/proposal/0xe358941aa3f3aeaf94d40e6904c9bb530c98f88e363c2f309d9898b0ffb16c1f)  and  [35](https://snapshot.org/#/cow.eth/proposal/0x1ce26799df80625cb8de5e985920b5f50e890290da03776bdd934e8bd03d9014)  and received an important proposal regarding increasing liquidity for the COW token via a programmatic order and an FM-AMM
-   In exciting news, CoW Protocol began officially  [charging fees on out-of-market limit orders](https://x.com/CoWSwap/status/1749858622027301159?s=20), published a  [2023 year in review](https://x.com/CoWSwap/status/1745859971617882529?s=20), and released a brand new  [set of docs](https://x.com/CoWSwap/status/1746916877677596936?s=20)

## Protocol Stats

This month, CoW Protocol settled a total of  **$1.92B.**

![1-january-2024-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_january_2024_highlights_a7ae839d24.webp)

The top batches worth highlighting are the following:

**Batch with the highest % of CoW trades (**[**Transaction details**](https://explorer.cow.fi/tx/0x72eb3893cbb060ac052b851a013a5b41838f868207ffdc9cb879af0a53e4a28b?tab=graph)**):**  The total batch volume was  **$1,264,508**, and it was created by two traders who were CoWed for  **$1,099,213, (86.3%)**  of the total batch volume. One trader was buying  **$1.2M of PEPE**  and the other trader was selling  **$1M of PEPE.**

![2-january-2024-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_january_2024_highlights_175d395b5e.webp)

**Batch containing the highest volume (**[**Transaction details**](https://explorer.cow.fi/tx/0xb5f4ca700520d35f8384adcfd895afa33b42d0676d5d210160c4855ebbbb5f7e?tab=orders&vis=transfers)**):**  The total batch volume was  **$10,186,406** and it was created by two traders who were swapping  **USDC**  to  **GEL** and  **sfrxETH**  to  **ETH**.

![3-january-2024-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_january_2024_highlights_da4efaf710.webp)

**Batch with the highest amount of surplus (**[**Transaction details**](https://explorer.cow.fi/tx/0xf77330676a021051edec058ba6ee36d199182aea5510f40d26309d00351e524d/?tab=graph&vis=transfers)**):**  The total batch volume was  **$118,905** and it was created by a single trader who was swapping  **ETH**  **to**  **stETH**. This trader achieved the largest surplus for the month of  **January** by getting  **48 stETH**  extra, which at the time of trade was roughly **$107K (2% surplus)**.

![4-january-2024-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_january_2024_highlights_e2c454bff4.webp)

During the month of  **January**, the top 10 traders traded a total of  **$197M.**

![5-january-2024-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_january_2024_highlights_ddd8c83163.webp)

In the table below you can see the total volume for this month’s biggest trades. The most active trader executed a whopping $**168M**  in trades with CoW Protocol this month.

![6-january-2024-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_january_2024_highlights_5ed4c8dd69.webp)

## Solvers

In  **January**, solvers generated a total of  **$16M**  in surplus, which is money in the pockets of traders.

![7-january-2024-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/7_january_2024_highlights_e6d6600d39.webp)

Below you can find a breakdown of how each solver performed in January.

![8-january-2024-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/8_january_2024_highlights_29f171bf7e.webp)

## Governance

It was a hectic month in terms of governance! The CoWs cannot be stopped 💪

![9-january-2024-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/9_january_2024_highlights_0859dafbe7.webp)

## Executed Proposals

The DAO  **executed two important proposals**  this month:

-   [CIP-34: Testing Fee Models for CoW Protocol](https://snapshot.org/#/cow.eth/proposal/0xe358941aa3f3aeaf94d40e6904c9bb530c98f88e363c2f309d9898b0ffb16c1f)
-   [CIP-35: Renewing the CoW Grants Program](https://snapshot.org/#/cow.eth/proposal/0x1ce26799df80625cb8de5e985920b5f50e890290da03776bdd934e8bd03d9014)

## Draft Proposals

This month,  **there was one new proposal**  asking for feedback before moving into the next phase, a final CIP, in its current form:

-   [CIP draft: Increasing liquidity for COW token via a programmatic order and an FM-AMM](https://forum.cow.fi/t/cip-draft-increasing-liquidity-for-cow-token-via-a-programmatic-order-and-an-fm-amm/2203)

Make sure to read the proposal and leave comments — your feedback is highly appreciated and will help move this important topic forward. If you are interested in submitting a proposal to the CoW DAO, make sure to use the following  [template](https://forum.cow.fi/t/cip-0-template/28).

## CoWmunity News

-   [Per CIP-34, CoW Protocol is now charging fees on out-of-market limit orders](https://x.com/CoWSwap/status/1749858622027301159?s=20)
-   CoW DAO had a phenomenal 2023. To commemorate it, the team published a  [product recap](https://x.com/CoWSwap/status/1745859971617882529?s=20)  as well as a  [data review](https://x.com/CoWSwap/status/1750199071535718557?s=20)  of all of the year’s important milestones
-   The CoW Protocol documentation received a  [much-welcome facelift](https://x.com/CoWSwap/status/1746916877677596936?s=20)  including a new website ([learn.cow.fi](https://learn.cow.fi/)) that helps anyone play around with CoW Protocol
-   The CoW Swap widget launched [color customization](https://x.com/CoWSwap/status/1742947998894792816?s=20)
-   [Teased the potential launch of CoW AMM](https://x.com/CoWSwap/status/1745500079677694377?s=20), a new MEV capturing AMM that prevents LVR and increases LP returns
-   [Launched a campaign to attract developers to help the CoW Protocol team fix Github PRs](https://x.com/CoWSwap/status/1752370895350538336?s=20)
-   Launched a campaign to help CoW Swap users understand key concepts of the protocol, kicking off with “[Coincidence of Wants](https://x.com/CoWSwap/status/1752686684406436204?s=20)”
-   The CoW team was featured on two podcasts:  [wen building by Antalpha labs](https://x.com/Antalpha_Labs/status/1742159634386071774?s=20)  and  [Steady Lads podcast by Jess Eckel](https://x.com/Jesseeckel/status/1748343775892504816?s=20)
-   Did you know that  [your lending protocol can perform MEV-protected liquidations via CoW Protocol](https://x.com/CoWSwap/status/1742053152978038957?s=20)?
-   One of the solvers participating in the CoW Protocol competition performed a study showing how  [Coincidence of Wants could potentially save Ethereum traders nearly $1.5M a day](https://x.com/CoWSwap/status/1750578345878639090?s=20)
-   The team published the following articles to the blog:  
    –  [Understanding MEV Protection](/learn/understanding-mev-protection)  
    –  [Understanding Batch Auctions](/learn/understanding-batch-auctions)  
    –  [EIP-1271 Explained](/learn/eip-1271-explained)

## Product Updates

**Backend**

The backend team has been working hard to improve the product infrastructure. In  **January**, we:

-   Completed the Sepolia testnet deployment for all backend services
-   Finished protocol fee implementation for limit orders
-   Worked on getting all the backend docs over the finish line
-   Investigated several issues related to the Composable CoW WatchTower
-   Worked on several preparations allowing external contributions to contribute to Github issues
-   Testing efforts for first phase of protocol fee initiative
-   Fixed several PRs for the rollout of verified quotes
-   Worked on indexing simplifications which should allow us to report order fees right after trades
-   Prepared a new interface for the Quasilabs solver

**Frontend**

The frontend team has been pushing hard for several improvements in the UI front, as well as the overall UI infrastructure. In  **January**, we:

-   Removed the Christmas theme
-   Improved the new  [learn.cow.fi](https://learn.cow.fi/)  website by polishing the interface (changed colors, logo, etc.) and adding a control to connect a wallet
-   Worked on a redesign for the confirmation screen to make displaying fee values more clear
-   Worked on several CoW Swap fixes including:
-   Removing time limits (deadlines) for TWAP orders, adding an option to set max deadline for limit order (6 months), showing price impact warning for Safe App when bundling, and relying on safeInfo and iframe detection to identify Safe wallets
-   Completed the Sepolia testnet deployment for all frontend services
-   Worked on several explorer improvement such as reduced page size (optimized images), cleaned up the codebase and migrated to monorepo
-   Released improvement for the widget with the possibility to add custom token lists

## Open Job Positions

## Engineering

[Backend Engineer with Rust](https://boards.eu.greenhouse.io/cowswap/jobs/4272022101)

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Welcome back to another CoW Update, where we break down the most notable developments of the last few weeks at CoW Protocol.


CoW Protocol January 2024 Highlights

EIP-1271 (also known as ERC-1271) is an Ethereum improvement that enables smart contracts to validate signatures, allowing them to sign transactions just like traditional EOA wallets.

While at first EIP-1271 may seem like a niche technical bit of implementation, the standard unlocks a whole world of functionality for smart contracts that includes intent-based trading, advanced order types, and every other type of blockchain interaction that requires a wallet signature.

## What is EIP-1271

EIP-1271 serves as a “[standard signature validation method for contracts](https://eips.ethereum.org/EIPS/eip-1271),” which gives smart contracts the ability to verify whether a signature on behalf of a given contract is valid — a feature that Externally Owned Accounts (EOA) already have built-in.

Before EIP-1271, smart contracts could send transactions, but they could not sign messages like traditional wallets. EOA have private keys which they use for signatures, validating that the message came from that particular wallet. Smart contracts, on the other hand, do not have private keys, so EIP-1271 was introduced as a standard way for smart contracts to validate a signature, enabling them to also sign messages.

### EIP-1271 vs ERC-1271

“EIP-1271” and “ERC-1271” are sometimes used interchangeably as terms that refer to the same concept. Ethereum accepts ideas for changes to the Ethereum network through a proposal process, hence the name “Ethereum Improvement Proposal” (EIP). “ERC,” on the other hand, stands for “Ethereum Request for Comment” and gets assigned to additions to the Ethereum network which do not change the underlying protocol itself.

This means that “EIP-1271” is more accurately called “ERC-1271,” as the addition does not change protocol functionality. As mentioned earlier, however, the terms are often used interchangeably.

## Why is EIP-1271 so useful?

Over the last few years, Ethereum has seen a boom in specialized smart contracts leveraging ERC-1271 to sign messages. Signed messages are necessary for a variety of things including placing orders on decentralized exchanges using off-chain order books, verifying that a given wallet belongs to a user, and much more.

ERC-1271-enabled smart contracts, however, unlock a whole new set of use-cases. This is because the ERC-1271 “isValidSignature” method can take in any arbitrary order logic, turning smart contract wallets into autonomous agents that can automatically sign messages based on on-chain conditions.

Let’s take a look at the various use-cases that ERC-1271 makes possible for smart contracts.

### Off-Chain Order Books

One of the most common uses of ERC-1271 involves orders on decentralized exchanges (DEX’s). Some exchanges, like CoW Protocol and Matcha, use an off-chain order book to collect signed messages before they become orders, allowing for additional optimizations. In order for smart contracts to be able to trade using these systems, they need ERC-1271 to validate signatures.

Limit orders in particular are a common type of DEX order that relies on an off-chain order book, so smart contracts require ERC-1271 in order to place limit orders.

### Sign-to-Verify

Authentication is a necessity in web3.

Many web3 applications require users to sign a message proving that they control a connected wallet in order to use the application. NFT marketplaces such as OpenSea and Rarible, meanwhile, require users to sign a message to place bids, update profile images, and perform other gas-less transactions.

In both of these cases, smart contract wallets leverage ERC-1271 to sign verification messages.

### Intents for Smart Contracts

Recently, many DeFi solutions have begun relying on  [intents](https://docs.cow.fi/cow-protocol/concepts/introduction/intents)  as a mechanism for providing users with better prices, MEV protection, advanced order types, and a whole host of other benefits.

CoW Protocol is a meta DEX aggregator that pioneered many use-cases of intents, all of which rely on signed messages. Regular EOA orders are signed ahead of time, but thanks to ERC-1271, smart contract orders can hold off on the order signature until settlement time and check that conditions such as oracle prices, current balances, block times, and more are met before the trade goes through. This unlocks a number of unique trading strategies only available through smart contract wallets.

**Milkman for Safe Trading**

In collaboration with the  [CoW Grants program](https://grants.cow.fi/), the  [Yearn.fi](https://yearn.fi/)  team launched  [Milkman](/learn/what-is-milkman-cow-swaps-solution-for-delayed-execution-trading)  to streamline DAO trades and protect them from MEV. The DAO governance process means that significant time passes between the time a trade is proposed and when the trade is actually executed. During this time, the market can move, invalidating the trade, or worse — an MEV searcher can lie in wait for the exact trade time and manipulate prices to exploit the trade.

Milkman provides a solution by allowing the DAO to specify a price feed which the smart contract checks at the moment of execution, making a trade based on the up-to-the-second price of the asset.

This means that DAOs no longer have to commit to an execution price ahead of time, but can leverage smart contracts and EIP-1271 to make a conditional order whose price is decided at the moment of execution.

**Advanced Order Types**

Smart contract signatures on CoW Protocol allow for a number of advanced order types. One notable example is CoW Protocol’s  [TWAP orders](/learn/cow-swap-launches-twap-orders), which use ERC-1271 smart contract signatures to autonomously place orders in even time intervals.

**The Programmatic Order Framework**

The  [Programmatic Order Framework](/learn/introducing-the-programmatic-order-framework-from-cow-protocol)  from CoW Protocol takes full advantage of ERC-1271 by allowing anyone to code custom order logic for any type of order.

Programmatic orders execute indefinitely into the future based on on-chain conditions. These conditions can include any arbitrary logic including checking on-chain prices, smart contract wallet balances, block times, volumes, and more.

There are already a number of deployed use-cases for ERC-1271-enabled programmatic orders including:

-   Automated DAO operations including payroll, treasury diversification, and fee collection
-   Portfolio rebalancing based on the state of assets in a smart contract wallet
-   Special order types including stop-loss, good-after-time, and take-profit

### Any Application Requiring a Signature

We’ve covered a number of the use-cases that require signed messages, but ERC-1271 enables a potentially limitless number of uses… Any time a smart contract wants to use an application that requires a wallet signature, they need ERC-1271.

Here are a few final examples requiring signatures:

-   **Gasless Trading**: Some decentralized exchanges leveraging intents have begun offering “gasless trading,” a feature which allows users to make trades without paying for gas in ETH. On CoW Protocol, for example, all trades take gas fees in the sell token, leveraging signed messages to specify the order details.
-   **Native Token Flow**: On CoW Protocol, users can trade ETH natively, without having to use the ERC-20 “WETH” wrapped version. This is once again enabled by signed messages which specify the order details while bonded third parties ([solvers](https://docs.cow.fi/cow-protocol/concepts/introduction/solvers)) handle the execution.
-   **Web3 Login**: Services such as  [Dynamic.xyz](https://www.dynamic.xyz/)  build account abstraction functionality which allows users to use decentralized apps with just a traditional web2 email address. When using smart contract wallets, these services heavily rely on ERC-1271 to provide full signing functionality.

## How EIP-1271 works

With the introduction of ERC-1271, smart contracts can now define an “isValidSignature” method which determines the conditions necessary for the smart contract to verify a signature and execute a transaction.

This implementation gives smart contracts a leg up over EOAs when it comes to signing transactions. This is because the “isValidSignature” method can include any arbitrary logic, allowing each smart contract to define its own parameters for generating a valid signature.

Some example criteria for returning a valid “isValidSignature” include:

-   Signatures from a set of hard-coded EOA addresses (used in Safe’s multi-signature model)
-   On-chain conditions like time passing between orders or reaching a given oracle price

If the owners of the smart contract would like to delegate the order placement to someone else, they can code the necessary conditions for validating a signature in the “isValidSignature.” Whenever anyone calls the smart contract, it will check these conditions and only execute when they are met.

![1-eip-1271-explained.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_eip_1271_explained_120c3a7916.webp)

ERC-1271’s “isValidSignature” method

The method takes a “bytes32 hash” representing an order hash and an arbitrary byte array which is where the conditions for the signature go. This array can be any number of things — an EOA signature from an owner or delegate of the smart contract, the smart contract checking an oracle or an on-chain state to determine if the order should execute, or any other arbitrary logic.

Finally, the “isValidSignature” method returns a response that determines whether the order should execute.

In essence, the entire signature verification process looks like this:

![2-eip-1271-explained.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_eip_1271_explained_1ec1facfc7.webp)

An order that needs to be signed is created

![3-eip-1271-explained.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_eip_1271_explained_f916ef6bed.webp)

The order generates an order hash

![4-eip-1271-explained.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_eip_1271_explained_b692a01062.webp)

The smart contract’s “isValidSignature” method is called with the hash and signature passed in as parameters

## EIP-1271: Enabling the future of smart contract trading

As Ethereum adoption grows, the needs of traders become more complex, eclipsing the built-in functionality of traditional EOAs. ERC-1271 opens the door to a new set of primitives for trading using smart contracts which can create autonomous, conditional orders that provide much greater trading power for users.

CoW Protocol is at the forefront of innovations relying on ERC-1271, and you can already take advantage of new order types today by swapping on  [CoW Swap](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=EIP-1271-article)  or by developing custom solutions through the  [Programmatic Order Framework](https://hackmd.io/pmZX_qT2Q1yw59KiiT6TPQ)  (also known as ComposableCoW).

As always, happy trading!

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EIP-1271 is an important upgrade to the Ethereum network that’s stirred up quite a buzz, but what exactly is it?


EIP-1271 Explained

As we bid farewell to another eventful year, we’re taking some time to reflect on CoW DAO’s milestones in 2023.

CoW DAO develops two main products:

-   **CoW Protocol & the CoW Swap Interface**: A decentralized exchange providing users with the best prices and cutting-edge MEV protection for swaps
-   **MEV Blocker**: An RPC endpoint designed to protect user transactions from suffering MEV attacks. MEV Blocker leverages an order flow auction among searchers and builders to offer users a rebate (backrun) for their trades

2023 has been marked by a number of noteworthy developments that have expanded protocol functionality, enhanced the user experience, and solidified CoW DAO’s position at the forefront of DeFi.

## CoW Protocol 2023 Product Launches

### Milkman — February

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">Timing trades has been a challenge for DAOs, but that&#39;s all changing thanks to Milkman. 🥛😎<br><br>Instead of a fixed trade amount, Milkman lets you use a price checker (i.e. <a href="https://twitter.com/chainlink?ref_src=twsrc%5Etfw">@chainlink</a>) to ensure a fair market price at execution, even far into the future!<a href="https://t.co/xH7fyqka0J">https://t.co/xH7fyqka0J</a> 👉</p>&mdash; CoW DAO | MEV Blocker &amp; CoW Swap (@CoWSwap) <a href="https://twitter.com/CoWSwap/status/1727326002202935304?ref_src=twsrc%5Etfw">November 22, 2023</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

The challenging task of timing trades for DAOs has finally found its solution in Milkman. Developed through the  [CoW Grants Program](https://grants.cow.fi/)  in collaboration with  [Yearn.fi](https://yearn.fi/), Milkman enables smart contracts to specify an on-chain data source, like an oracle, as a reference for the otherwise static “min_out” function. This is a game-changer for deferred trade execution, as it gives DAOs a dynamic price backstop that guarantees up-to-date pricing despite governance-related delays.

Born of the spirit of collaboration, Milkman has already made its mark by facilitating large trades from major DAOs. In 2023,  [Aave used Milkman to swap $4 million directly into a Balancer LP](/learn/aave-trade-breakdown),  [Nexus Mutual used it to trade over 14.4K ETH for rETH](/learn/nexus-mutual-trade-breakdown), and  [ENS traded 10K ETH for USDC](/learn/ens-trade-breakdown). To date, Milkman has already handled over $20 million in trading volume!

Learn more about Milkman: “[What is Milkman? CoW Swap’s Solution for Delayed Execution Trading](/learn/what-is-milkman-cow-swaps-solution-for-delayed-execution-trading)”

### Partially Fillable Limit Orders — April

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">Say hello to *partially fillable limit orders* from CoW Swap.<br><br>Now enabled by default, partial fills bring faster trade settlement to limit orders – even in moments of low liquidity. 🏃💨<br><br>Learn more here: <a href="https://t.co/lJ0b4qON9y">https://t.co/lJ0b4qON9y</a> <a href="https://t.co/iqxyI86l6Z">pic.twitter.com/iqxyI86l6Z</a></p>&mdash; CoW DAO | MEV Blocker &amp; CoW Swap (@CoWSwap) <a href="https://twitter.com/CoWSwap/status/1647962756400701443?ref_src=twsrc%5Etfw">April 17, 2023</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

The introduction of partially fillable limit orders in April unlocked a faster limit order experience that also reduces price impact for large orders.

Unlike traditional “fill or kill” limit orders, partially fillable limit orders execute gradually as liquidity becomes available. For users, this means that their limit orders will complete earlier, as they can gather liquidity over time rather than having to wait for it to become available all at once.

What’s more, partially fillable limit orders are “surplus capturing,” meaning that users can receive surplus on top of their limit price. If the solvers execute a limit order for better than the limit price, the positive price difference (known as “surplus”) will be passed along to the user.

Learn more about Partially Fillable Limit Orders: “[CoW Swap Improves the Limit Order Experience with Partially Fillable Limit Orders](/learn/cow-swap-improves-the-limit-order-experience-with-partially-fillable-limit-orders)”

### CoW Hooks — July

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">Today, CoW Swap is ushering in a new era in intents-based DeFi.<br><br>Introducing CoW Hooks!<br><br>With CoW Hooks you can take multiple DeFi actions: swapping, bridging, staking, depositing, borrowing, and more — &amp; group them all together into one single intent!<br><br>📖 <a href="https://t.co/RZxQQYue5k">https://t.co/RZxQQYue5k</a> <a href="https://t.co/CMNIUXFtGK">pic.twitter.com/CMNIUXFtGK</a></p>&mdash; CoW DAO | MEV Blocker &amp; CoW Swap (@CoWSwap) <a href="https://twitter.com/CoWSwap/status/1678766456719433729?ref_src=twsrc%5Etfw">July 11, 2023</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

The launch of CoW Hooks transformed CoW Protocol from a swap-intent-matching engine into a generalized intent execution machine. Thanks to CoW Hooks, users can now specify pre and post-trade interactions for solvers to execute alongside their trades.

CoW Hooks interactions can be any DeFi actions: bridging, staking, depositing, or anything else a user would like to do before or after their trade. The best part? Solvers execute the entire sequence of pre and post interactions as a single transaction. True to the CoW Protocol model, users pay gas fees in their sell token, and they only pay if the transaction succeeds.

Learn more about CoW Hooks: “[CoW Hooks: You are in control!](/learn/cow-hooks-you-are-in-control)”

### TWAP (Time Weighted Average Price) Orders — August

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">🚨🚨<br><br>TWAP orders are now available on CoW Swap! (Call us CoW Twap!)<br><br>TWAP orders let users split their trades over time while benefiting from CoW’s signature MEV protection &amp; best prices.<br><br>Available for <a href="https://twitter.com/safe?ref_src=twsrc%5Etfw">@safe</a> wallets today.<br><br>Learn more: <a href="https://t.co/A4l5P7G696">https://t.co/A4l5P7G696</a> <a href="https://t.co/ssj2xtDr8Z">pic.twitter.com/ssj2xtDr8Z</a></p>&mdash; CoW DAO | MEV Blocker &amp; CoW Swap (@CoWSwap) <a href="https://twitter.com/CoWSwap/status/1692152855694803112?ref_src=twsrc%5Etfw">August 17, 2023</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

In August, CoW Protocol launched the first implementation of TWAP orders on a decentralized exchange to date. TWAP allows users to split large trades into smaller, discrete orders which execute over a specified time period. This lessens price impact, ensures entry at a “average” market price, and enhances MEV protection.

Learn more about TWAP orders: “[CoW Swap Launches TWAP Orders](/learn/cow-swap-launches-twap-orders)”

### Gasless Approvals — October

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">Cows can sometimes get a bad rap for their gas emissions...<br><br>But CoW Swap is committed to reducing gas as much as possible.<br><br>That&#39;s why we&#39;re pleased to announce that gasless approvals are now live on <a href="https://twitter.com/CoWSwap?ref_src=twsrc%5Etfw">@CoWSwap</a>. <a href="https://t.co/NOQeeVtacr">pic.twitter.com/NOQeeVtacr</a></p>&mdash; CoW DAO | MEV Blocker &amp; CoW Swap (@CoWSwap) <a href="https://twitter.com/CoWSwap/status/1714633297408696409?ref_src=twsrc%5Etfw">October 18, 2023</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

CoW Swap has offered gasless swaps since the start, but in October we made the entire experience — approvals + swaps — entirely gasless for over 100 tokens. With gasless approvals, the intents that users sign to place an order now give solvers the permission to execute both the swap AND the approval transaction on behalf of the user.

Thanks to this, brand new wallets can use CoW Swap without holding any ETH, as all fees get deducted in the sell token.

Learn more about gasless approvals: “[Announcing Gasless Approvals on CoW Swap](/learn/announcing-gasless-approvals-on-cow-swap)”

### Programmatic Order Framework — November

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">CoW Swap is excited to announce the launch of an entirely new class of orders. We call them Programmatic Orders. ✨<br><br>Programmatic Orders execute automatically, in perpetuity, according to the conditional parameters you set.<br><br>Let&#39;s dive in. 🤿 <a href="https://t.co/sOXKCMsYLu">pic.twitter.com/sOXKCMsYLu</a></p>&mdash; CoW DAO | MEV Blocker &amp; CoW Swap (@CoWSwap) <a href="https://twitter.com/CoWSwap/status/1722735351972983030?ref_src=twsrc%5Etfw">November 9, 2023</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

The Programmatic Order Framework pioneered a new era of “programmatic orders,” which are automated orders that execute based on on-chain conditions.

Programmatic orders are created with just one signature, and they execute when certain on-chain conditions (prices, volumes, balances, times, etc.) are met. These orders can stretch indefinitely into the future, automating everything from complex trading strategies to advanced order types, portfolio management, DAO operations, and more.

The Programmatic Order Framework itself is used to create programmatic orders by automating the boilerplate code necessary for order placement. This allows DeFi users to programmatically create any set of orders and automatically approve them for execution with just a single signature.

Learn more about the Programmatic Order Framework: “[Introducing the Programmatic Order Framework, from CoW Protocol](/learn/introducing-the-programmatic-order-framework-from-cow-protocol)”

### Widget — November

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">Merhaba. Hello.<br><br>The CoW Swap widget is live. If you&#39;ve ever thought &quot;damn, I wish my users could do MEV-protected swaps/limits/TWAPs, capture surplus, and not spend gas on their trades&quot; this widget is for you.<br><br>Learn more at <a href="https://t.co/jHxQRC2ri9">https://t.co/jHxQRC2ri9</a> or reach out to chat live.<br><br>📣 <a href="https://t.co/wuhKJkJD9m">pic.twitter.com/wuhKJkJD9m</a></p>&mdash; CoW DAO | MEV Blocker &amp; CoW Swap (@CoWSwap) <a href="https://twitter.com/CoWSwap/status/1724037068610056354?ref_src=twsrc%5Etfw">November 13, 2023</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

Launched with the goal of bringing the lush pastures to a wider audience, the widget embeds a CoW Swap trading module on any website or web3 dApp. Projects can now bring CoW Swap’s famous MEV protection and best prices to their users and even collect fees from swaps made through the widget.

Learn more about the widget  [on our website](https://cow.fi/widget).

## Improvements Throughout The Year

-   **Surplus Notifications →** Users now see exactly how much they received in surplus after every trade! Wallets connected to CoW Swap can also view their total historical surplus using the account tab 💸
-   **Fortune Cookies →**  Besides being the best place to trade, CoW Swap is also the most fun! This year, we added fortune cookies to the UI, welcoming you with a new message each day to inspire you along your trading journey 🥠
-   **Custom Recipient Addresses →**  It’s now possible to make a trade with funds from one wallet that sends proceeds to a different wallet. Save on gas fees and expedite your trades with custom recipient addresses 🔀
-   **Token Page Release →**  The  [token page](https://swap.cow.fi/#/account/tokens)  lists the tradeable tokens on CoW Swap. Users can use the page to sign the approval transactions necessary for trading new tokens in advance — useful if you’re trying to time the market ⏳
-   **The Limit Orders Stop Light →**  Limit orders received a useful UI upgrade that shows how close your orders are to completing. The limit order “stop light” lights up in different colors depending on how close the market price is to what it needs to be for your limit orders to execute 🚦
-   **A World of Notifications →**  Staying informed is key in the world of DeFi. To this end, CoW Swap enabled notifications through Discord, Telegram, and email to help users stay up to date with new announcements 🔔

## The CoW Protocol Revolution: A Year of Collaboration

The shipping hasn’t only been us, though. We’re proud to have encouraged innovation in DeFi even outside of the CoW DAO ecosystem. Below is a list of projects that are integrated with or built on top of CoW Protocol.

### 1. Dump Services

CoW DAO introduced  [dump.services](https://dump.services/), a dApp that allows users to swap (“dump”) multiple tokens from their wallet all at once by trading them for a single asset. This streamlines portfolio management, especially for small token balances.

### 2. CoW Swap Safe App Batch Transactions

The  [CoW Swap Safe App](https://app.safe.global/share/safe-app?appUrl=https%3A%2F%2Fswap.cow.fi&chain=eth)  introduced a game-changing feature — the ability to bundle multiple transactions into a single batch. Thanks to the Safe batching feature, users can merge approving, wrapping, and trading into a single, cost-effective transaction.

### 3. The Tally Recipe for CoW Swap

Tally, a prominent DAO tooling platform, launched  [a Recipe for CoW Swap](/learn/tally-recipe-for-cow-swaps). The Tally CoW Swap Recipe leverages Milkman to let DAOs attach a swap to a governance proposal, turning a multi-step process into only a few clicks.

### 4. Stackly DCA

[Stackly](https://stackly.eth.limo/)  is a new dApp that brings Dollar-Cost Averaging (DCA) swaps to DeFi users on Ethereum and Gnosis chain. Under the hood, Stackly leverages  [CoW Protocol ERC-1271 smart orders](/learn/tutorial-creating-smart-orders-with-cow-protocol)  for the trades.

### 5. Coinshift Apps

Treasury management platform  [Coinshift](https://coinshift.xyz/)  integrated CoW Swap as a part of its suite of apps, bringing the safety and reliability of CoW Swap to the DAOs using Coinshift for their treasury operations.

### 6. Stader Swap Feature

The liquid staking service  [Stader Labs](https://www.staderlabs.com/eth/)  added a “Swap” function powered by CoW Swap which directs users to trade tokens on CoW Swap dApp.

### 7. Lido Swap Feature

Staking service  [Lido](https://lido.fi/)  also added CoW Swap as one of their “withdrawal” options for users looking to convert stETH to ETH right on the platform.

## New Products: MEV Blocker

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">CoW Swap, in collaboration with <a href="https://twitter.com/beaverbuild?ref_src=twsrc%5Etfw">@beaverbuild</a> and Agnostic Relayer, is proud to announce MEV Blocker. <a href="https://t.co/WIhaaGtP0e">https://t.co/WIhaaGtP0e</a> ⛱️<br><br>MEV Blocker is a free RPC endpoint that *pays users* to protect themselves from MEV across a wide variety of use cases in DeFi, NFTs, and dApps. <a href="https://t.co/Fa6cRNjrxf">pic.twitter.com/Fa6cRNjrxf</a></p>&mdash; CoW DAO | MEV Blocker &amp; CoW Swap (@CoWSwap) <a href="https://twitter.com/CoWSwap/status/1643614395002499073?ref_src=twsrc%5Etfw">April 5, 2023</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

While the lush pastures of CoW DAO saw a lot of shipping in 2023, there was one flagship launch that stood above the rest:  [MEV Blocker](https://mevblocker.io/).

CoW DAO, in collaboration with  [Beaver Build](https://beaverbuild.org/)  and  [Agnostic Relay](https://agnostic-relay.net/), introduced MEV Blocker to protect Ethereum transactions from frontrunning and sandwich attacks. The free RPC endpoint routes transactions through a permissionless network of searchers who cannot frontrun or sandwich user transactions. Instead, searchers capture value through backrunning, sending 90% of all profits back to the users as rebates.

MEV Blocker addresses the multi-billion dollar MEV problem, enabling users to trade, buy NFTs, provide liquidity, and more without worrying about harmful price exploitation.

## Reflecting on our Udderly amazing Journey, and cheers to a CoW-tastic 2024!

2023 has been the most exciting year so far for CoW DAO. We’re already diving headfirst into 2024 with a renewed commitment to more products built for both novice and experienced users. Here’s to another thrilling year at the forefront of DeFi!

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365 Days of Udderly Fantastic CoWventures!


CoW DAO: 2023 in Review!

Batch auctions are a powerful trading mechanism for settling orders on decentralized exchanges. Recently, batch auctions have attracted attention in the DeFi space thanks to a host of benefits including better prices and built-in MEV protection.

In this article, we’ll take a look at how batch auctions work, why they’re important, and how CoW Protocol, one of the leading innovators in the DeFi space, is leveraging batch auctions as a decentralized exchange aggregator.

## What is a batch auction?

![1-understanding-batch-auctions.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_understanding_batch_auctions_bdc2352d7f.webp)

A batch auction is a trading mechanism that groups orders together into “batches” and “auctions” them off to execution parties who compete against each other to find the most optimal order settlement path.

Grouping trades together allows batch auctions to enforce certain execution rules that prevent MEV attacks. The competition between execution parties makes batch auctions a type of “[order flow auction](/learn/understanding-order-flow-auctions),” meaning they are designed to find optimal prices for user trades.

In  order to find the best prices for the orders in a given batch, the execution parties (commonly known as “[solvers](https://docs.cow.fi/cow-protocol/concepts/introduction/solvers)”) aggregate liquidity from as many sources as possible — AMMs, private off-chain liquidity, and even by routing swaps peer-to-peer between the orders in a batch.

To really understand how batch auctions work under the hood, however, we must first consider how trading takes place on decentralized exchanges (DEX’s).

### How decentralized exchanges work

Due to the volatility of crypto markets, traders have to set a “slippage tolerance” every time they make a trade on a decentralized exchange. The slippage tolerance specifies the price deviation that traders are willing to accept for the assets in their order. Slippage is necessary because it accounts for changes in price between the time traders place an order and the time the order gets executed.

Decentralized exchanges rely on automated market makers ([AMMs](/learn/cow-protocol-glossary#:~:text=amm)) to provide liquidity for trades. AMMs settle trades sequentially, meaning that every order gets executed individually as it comes in. While AMMs ensure a smooth and continuous flow of transactions, their design leaves room for MEV as malicious parties can force trades to execute at a maximum slippage tolerance, giving traders worse prices than they would normally get.

This is where batch auctions come in.

## How batch auctions mitigate the MEV problem

At its core, MEV relies on  [reordering transactions](/learn/what-is-a-sandwich-attack-and-how-can-you-protect-yourself)  from the way they were submitted to a new, more profitable order. Malicious traders, known as “searchers,” monitor the Ethereum mempool — a holding area where transactions accumulate before they are included in a block and confirmed on-chain — and bribe block builders to strategically place transactions to their advantage.

Orders in a batch are executed as a single transaction, rather than sequential transactions, giving solvers tools they can leverage to keep trades safe from MEV.

**Uniform Clearing Prices**: MEV relies on reordering transactions such that sequential orders clear for slightly different prices. Searchers pocket the differences between these prices as arbitrage. With batch auctions, multiple orders trading the same token pair (such as ETH-DAI) within a single batch clear for the same price. This makes transaction reordering useless, bypassing the risk of MEV.

**Coincidence of Wants (CoWs)**: If traders in a batch are trading opposite assets, they may be matched peer-to-peer in a “[Coincidence of Wants](/learn/what-are-cows-on-cow-swap)” trade. For example, if one user is selling ETH for DAI and another is selling DAI for ETH, the two traders can simply swap assets. This provides better prices and bypasses MEV, as orders don’t have to tap on-chain liquidity.

**Enforcing the Ethereum Best Bid Offer (EBBO):**  Thanks to the competition for execution, batch auctions guarantee that the settlement solution is at least as good as the on-chain price a user could get directly by going directly to an AMM.

## CoW Protocol’s batch auction process explained

CoW Protocol, an innovative DEX aggregator,  [leverages batch auctions](/learn/navigating-the-evolution-of-cow-swap-from-market-orders-to-programmatic-orders)  to provide optimal trading prices and  [protect traders from MEV](/learn/how-cow-swap-solves-the-mev-problem).

![2-understanding-batch-auctions.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_understanding_batch_auctions_4462e85993.webp)

Trades on CoW Protocol begin as signed “[intent to trade](/learn/cow-protocol-glossary#:~:text=Intent%20to%20Trade)” messages that get sent to an orderbook. From here, the protocol groups these intents into batches and invokes  [solvers](https://docs.cow.fi/cow-protocol/tutorials/solvers)  for the actual order execution. Solvers search all available on-chain liquidity, and even tap off-chain liquidity, to find the most efficient execution route for the batch.

Once the protocol gathers orders in a batch, it runs an “auction” to pick the winning solver that gets to settle the batch on-chain. The winner is picked based on which solver can offer the most price surplus for the orders in the batch (surplus is defined as the positive difference in price between the quoted price and the actual execution price.) Finally, the winning solver executes the orders in the batch on-chain on behalf of the users.

Thanks to frequent batch auctions, CoW Protocol guarantees a uniform clearing price for all assets, allows trades to be matched peer-to-peer in Coincidences of Wants (CoWs), and also provides several other unique benefits including:

-   Gas optimizations thanks to reduced overhead when executing multiple orders in a single transaction
-   No deposits or withdrawals into an exchange contract, meaning that all balances are credited directly to user accounts atomically in a single Ethereum transaction
-   Fair, decentralized settlement in which an open competition for order matching replaces a central operator or a constant function market maker

### An example batch auction on CoW Protocol

To demonstrate the power of batch auctions, let’s take a look at an example involving a typical batch on CoW Protocol.

![3-understanding-batch-auctions.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_understanding_batch_auctions_a5b9ca70ad.webp)

For this example, we’ll take a look at  [a batch from January 2024](https://explorer.cow.fi/tx/0x6b905fb7bc096520594fda48648dcb82fa0503b1bcbe0faf906ca7290104d950?tab=orders&vis=transfers). In this settlement, a solver executed five different trades as a single batch, forming several CoWs and leveraging on-chain liquidity to fill the orders the rest of the way.

The batch began with traders trading DAI for ETH in the first two orders and the reverse — ETH for DAI — in the third order.

![4-understanding-batch-auctions.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_understanding_batch_auctions_9c95ead419.webp)

This inverse-swap allowed for a Coincidence of Wants. The third order was for ~500 ETH, while the first two orders were only for ~216 ETH, so the solver was able to fill the first two orders entirely using the third order’s liquidity. In return, the third order received ~216 ETH’s worth of DAI and the solver went to an on-chain AMM ([0x in this case](https://etherscan.io/tx/0x6b905fb7bc096520594fda48648dcb82fa0503b1bcbe0faf906ca7290104d950)) to source liquidity for the remaining DAI it needed to fill.

![5-understanding-batch-auctions.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_understanding_batch_auctions_7d79cdfbf9.webp)

The last two orders in the batch traded USDC for ETH. The solver executed both of these orders on-chain, but they still received a better price than quoted because they executed in a single batched transaction, saving on gas fees and protocol fees.

![6-understanding-batch-auctions.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_understanding_batch_auctions_a1edd33980.webp)

In the end, not only did batch auctions protect these orders from MEV, they also allowed the solver responsible for executing the batch to provide each order with price surplus.

A few percentage points may not seem like much, but the surplus amounts to almost $20,000 across all orders in this batch. This is money that would have been left on the table in a traditional AMM.

![7-understanding-batch-auctions.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_understanding_batch_auctions_f44757a473.webp)

## Batch auctions: The future of fair trading

Batch auctions are gaining notoriety as a mechanism for ensuring optimal price discovery and protecting orders from MEV.

While CoW Protocol has built an innovative frequent batch auction mechanism for DeFi trades, there are still improvements that can further protect users. In particular, CoW Protocol is looking forward to experimenting with batch time lengths that are equivalent to block time lengths. This would ensure that each CoW Protocol batch executes 1:1 with each Ethereum block, providing uniform clearing prices on the block level, rather than just the batch level, further mitigating MEV.

To experience the power of batch auctions for yourself, give  [CoW Swap](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=batch-auctions-article)  a try for your next trade on Ethereum or Gnosis chain.

Happy batching!

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Batch Auctions.png

Batch auctions provide a host of benefits including MEV protection and better prices, but how do they really work?


Understanding Batch Auctions

## TL;DR

-   During the month of  **December**, CoW Protocol handled a total volume of  **$1.73B**  and generated a surplus of  **$14.9M**
-   In exciting news, the  [Crypto.com wallet integrated MEV Blocker](https://x.com/CoWSwap/status/1732776869584396433?s=20), we teamed up with  [Chain Patrol for our Discord](https://x.com/CoWSwap/status/1740387210090987525?s=20), and we welcomed traders to CoW Swap with a special holiday “Moo-ho-ho” 🎅

## Protocol Stats

This month, CoW Protocol settled a total of  **$1.73B.**

![1-december-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_december_2023_highlights_08516ca0a3.webp)

The top 3 batches worth highlighting are the following:

-   **Batch with the highest % of CoW trades**  **(**[**Transaction details**](https://explorer.cow.fi/tx/0xc0fa0316df77f61da1976094d5cb117f76dc47b1d93b855bc404b231a7a448d0?tab=graph)**):**  The total batch volume was  **$4,924,638.28**, and it was created by two traders who were perfectly CoWed for  **$4,923,442.30 (99.8%)**  of the total batch volume. One trader was selling ~**59K of wNXM for WETH**, and the other trader was buying  **~50K of wNXM for WETH.**  Even more interesting, one of the orders was a partially fillable limit order which was filled 87% of the way by this CoW.

![2-december-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_december_2023_highlights_d74c092297.webp)

-   **Batch containing the highest volume**  **(**[**Transaction details**](https://explorer.cow.fi/tx/0x82851a56f09e1d10643d7ec5369f35cc9f50bc36a3a29e0a13ee5d781198ce09?tab=graph&vis=transfers)**)**: The total batch volume was  **$20,423,856.02** and it was created by three traders who were swapping the following tokens: ~**$9K of ETH to GEAR**, ~**$3K of USDC to BEND,**  and ~**$20.4M of USDC to DAI**.

![3-december-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_december_2023_highlights_7861b0ae2e.webp)

-   **Batch with the highest amount of surplus**  **(**[**Transaction details**](https://explorer.cow.fi/tx/0xd6013c8d24db365330e054fb665755d0c4d50f726b08a7afa34671678c13daf8?tab=graph)**)**: The total batch volume was  **$94,152.64** and it was created by two traders who were swapping ~**$4.7M**  of  **ETH**  **to**  **wstETH** and ~**$1K USDC** to **LIT**. The first trader achieved the largest surplus for the month of  **December**  by getting  **$94,152.64** back, which represented 2.04**%**  of their order size.

![4-december-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_december_2023_highlights_03cc8845fa.webp)

During the month of  **December**, the top 10 traders traded a total of  **$35M.**

![5-december-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_december_2023_highlights_87f4c2b0cb.webp)

In the table below you can see the total volume for this month’s biggest trades. The most active trader executed a whopping  **$10M**  in trades with CoW Protocol this month.

![6-december-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_december_2023_highlights_3c9dc56e0c.webp)

## Solvers

In  **December**, solvers generated a total of  **$14.9M** in surplus, which is money in the pockets of traders.

![7-december-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/7_december_2023_highlights_5b78c0a1b3.webp)

Below you can find a breakdown of how each solver performed in December.

![8-december-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/8_december_2023_highlights_ce0ebfda05.webp)

## Governance

It was a relaxed month in terms of governance! The CoWs had time to play in the snow 💪

![9-december-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/9_december_2023_highlights_f723d72fd8.webp)

## Executed Proposals

The DAO did not execute any proposals.

## Draft Proposals

There were  **no new proposals**  this month, but two important proposals from last month are still looking for feedback before moving into the next phase, final CIPs, in their current form:

-   [CIP-Draft: Testing Fee Models for CoW Protocol](https://forum.cow.fi/t/cip-draft-testing-fee-models-for-cow-protocol/1984)
-   [CIP-Draft: Solver Computed Fees & Rank by Surplus](https://forum.cow.fi/t/cip-draft-solver-computed-fees-rank-by-surplus/2061)

Make sure to read them and leave comments — your feedback is highly appreciated and will help move these important topics forward. If you are interested in submitting a proposal to the CoW DAO, make sure to use the following  [template](https://forum.cow.fi/t/cip-0-template/28).

## CoWmunity News

-   Installed the new  [Chain Patrol Discord bot to make reporting scammers easier](https://twitter.com/CoWSwap/status/1740387210090987525?s=20)
-   Participated in the following podcasts and twitter spaces:  [Blockmates, “The Future of Decentralized Trading](https://twitter.com/CoWSwap/status/1738177889026101653?s=20),”  [Native, “The Future of DEX Spot Trading](https://twitter.com/CoWSwap/status/1737824044773151140?s=20)” and a  [Steak Capital DEX Panel](https://twitter.com/CoWSwap/status/1733124589364838586?s=20)
-   Got featured in a fantastic podcast  [covering intents](https://twitter.com/CoWSwap/status/1732089015199797307?s=20)
-   Wrote two recaps of CoW DAO member talks from Dappcon: “[MEV Transparency: Ensuring Fairness In DeFi Markets](https://twitter.com/CoWSwap/status/1736768910371016898?s=20)” and “[Navigating the Evolution of CoW Swap: From Market Orders to Programmatic Orders](https://twitter.com/CoWSwap/status/1740786005538746656?s=20)”
-   Gathered all the talks, panels, and discussions that CoW DAO members participated in during  [Devconnect IstanBULL!!](https://twitter.com/CoWSwap/status/1737130917272187119?s=20)
-   The lion from Crypto.com incorporated the best protection under the sun by  [integrating MEV Blocker natively into the Crypto.com DeFi wallet app](https://twitter.com/CoWSwap/status/1732776869584396433?s=20)
-   Reminder that in November, CoW Swap launched a Widget which also comes embedded with an  [enticing integration rewards program funded by CoW Grants DAO](https://twitter.com/CoWSwap/status/1731711217230565465?s=20)
-   [Did you know that 69% of all trades this year had a better execution price than originally quoted](https://twitter.com/CoWSwap/status/1734565064810889506?s=20)?
-   [CoW Swap gave a random CoW a new addiction :)](https://twitter.com/BixbiteOfficial/status/1737349265649758270?s=20)
-   Watched people YOLO their trades —  [this user traded with 50% slippage and got twice as much as they asked for](https://twitter.com/CoWSwap/status/1739277374565580822?s=20)!
-   Reminded people that the only venue where  [limit orders get price improvements is CoW Swap](https://twitter.com/CoWSwap/status/1740631237788868653?s=20)

## Product Updates

**Backend**

The backend team has been working hard to improve the product infrastructure. In  **December**, we:

-   Fixed a memory leak that caused the colocated driver to be restarted very often
-   Fixed a bug that could cause incorrect internal buffer trading optimizations
-   Did lots of bug fixes and performance improvements + added metrics for colocation (inflight order filtering, track time to solve and other solver metrics, optimize fetching token metadata and debugging information)
-   Made progress towards deploying on Sepolia
-   Made improvements for faster settlement times
-   Worked on backend deployment for Sepolia testnet
-   Worked on backend documentation for the refreshed docs.cow.fi release

**Frontend**

The frontend team has been pushing hard for several improvements on the UI front as well as the overall UI infrastructure. In  **December**, we:

-   Implemented theme colors for widget customizations
-   Polished and fixed items related to wallet balances and allowances
-   Released CoW Swap v1.51 (Token Lists: v2 of pre-calculated permit, permit improvements, improved loading of balances, and more)
-   Worked on frontend documentation for the refreshed docs.cow.fi release
-   Disabled Ledger Live in a hotfix due to their exploit
-   Worked on a variety of fixes including UI issues (Safe via WC, Ledger Live integration (now removed), classic ETH flow, fixes on TWAP orders not being shown (edge case), and fixes on buy orders
-   Deployed the Christmas theme 🎅 — Moo-ho-ho-ho!

## Open Job Positions

The CoW Protocol team is currently not hiring

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CoW Protocol December 2023 Highlights

MEV, or maximal extractable value, is a form of price exploitation that acts as a “hidden tax” on Ethereum transactions.

To date, MEV has caused over a billion dollars in losses for everyday traders, especially beginners who often don’t know how to protect themselves.

![1-understanding-mev-protection.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_understanding_mev_protection_5c36d92e50.webp)

In this article we’ll take a look at what MEV is and explore some of the popular protection solutions.

## What is MEV protection?

MEV protection refers to a broad set of strategies that keep users safe from price manipulation when trading, providing liquidity, minting NFTs, and more.

### What exactly are you protecting against?

To understand MEV, we must first understand how Ethereum transactions are processed.

![2-understanding-mev-protection.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_understanding_mev_protection_9bb7157306.webp)

When a user places an order, it initially gets submitted to a holding area for pending Ethereum transactions known as the “mempool.” Transactions in the mempool are public, meaning that MEV bots (known as “searchers”) can monitor them for exploitation opportunities. MEV relies on reordering transactions from the order in which they were submitted to a new, more profitable order.

To better understand this process, let’s trace the flow of a sandwich attack — the worst type of MEV.

![3-understanding-mev-protection.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_understanding_mev_protection_b1a61b2259.webp)

Essentially, traders place orders on  [AMMs](/learn/cow-protocol-glossary#:~:text=AMM)  by designating a  [slippage tolerance](/learn/cow-protocol-glossary#:~:text=Slippage%20Tolerance). Searchers can exploit these orders by placing similar trades before and after the user trade, manipulating the price of the assets on the AMM and forcing the victim trade to execute at a higher price.

Searchers pocket this difference in price for themselves. Their only cost is the amount of money they spend bribing the Ethereum block builders to order the transactions in a specific way.

To learn more about the different types of MEV, check out our articles on  [sandwich attacks](/learn/what-is-a-sandwich-attack-and-how-can-you-protect-yourself),  [frontrunning](/learn/what-is-frontrunning), and  [backrunning](/learn/what-is-backrunning-mev-attacks-explained).

Now let’s take a look at how you can protect yourself from MEV.

## Slippage tolerance and MEV protection

The most basic defense against MEV is setting a low slippage tolerance.

Since MEV relies on slippage for price manipulation, transactions with a lower slippage tolerance give searchers less room to exploit trades.

For users who aren’t utilizing any other MEV protection tools, setting a lower slippage tolerance can be a good first line of defense, however it’s by no means a complete solution. Setting the slippage tolerance too low often results in failed transactions. Even with optimal slippage, MEV bots may still be able to extract value from your trades.

## RPC endpoint tools for MEV protection

A better protection method is to install an MEV protection RPC endpoint.

A Remote Procedure Call (RPC) endpoint is an intermediate layer that routes transactions from a user’s wallet to the blockchain itself. Transactions pass through RPC endpoints before getting to the mempool, so RPCs can provide additional functionality across any blockchain application or protocol.

Normally, RPCs are a boring piece of blockchain infrastructure. Recently, however, specialized RPCs have begun incorporating extra security guarantees for transactions before they reach the blockchain.

### MEV Blocker

One of the most popular specialized RPC endpoints is  [MEV Blocker](https://mevblocker.io/).

As the name suggests, MEV Blocker provides protection against MEV across all of Ethereum. The RPC works by managing a permissionless network of searchers and hiding transactions from the public mempool. These searchers cannot frontrun or sandwich user transactions. Instead, they capture value through  [backrunning](/learn/what-is-backrunning-mev-attacks-explained).

Anytime a searcher backruns a user’s transaction, the searcher keeps up to 10% of the value and send the other 90% back to the user as a rebate. So even when a transaction leaves money on the table, MEV Blocker puts it back into the pockets of users.

MEV Blocker provides protection for any type of Ethereum transaction (not just swaps), and it works with all Ethereum wallets. Install the MEV Blocker RPC endpoint by following the instructions  [here](https://mevblocker.io/).

## Decentralized applications and MEV protection

While RPC endpoints provide significant MEV protection, the most complete protection comes at the application layer.

As MEV has become more prevalent, decentralized applications (especially decentralized exchanges — DEX’s) have begun offering creative protection solutions to users. For example, many DEXs offer an “auto-slippage” feature which determines the optimal slippage for user trades, reducing the chances of price exploitation.

### Native MEV protection on CoW Protocol

CoW Protocol is a meta DEX aggregator that finds the best prices for trades and provides comprehensive MEV protection. The protocol uses a unique trading mechanism that relies on batch auctions and  [intents](/learn/cow-protocol-glossary#:~:text=Intent%20to%20Trade)  to achieve the best outcomes for users.

![4-understanding-mev-protection.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_understanding_mev_protection_cf34f8959e.webp)

Starting at the application level, CoW Protocol provides end-to-end MEV protection through its unique protocol design:

**Delegated Trade Execution**: On CoW Protocol, bonded third parties known as “solvers” execute transactions on behalf of users. Solvers source liquidity across multiple DEX’s and even offchain liquidity sources to find the best prices for any given trade. Solvers also execute transactions on behalf of users, meaning they are never exposed to the blockchain directly.

**Coincidences of Wants**  **(CoWs)**: Thanks to CoW Protocol’s batching mechanism, trades may be matched using peer-to-peer liquidity in a  [Coincidence of Wants (CoW)](/learn/what-are-cows-on-cow-swap). This method of trading bypasses AMMs, reducing fees and preventing MEV.

**Uniform Clearing Prices**: Another benefit of batching is that duplicate trade pairs within a given batch clear for the same price. For example, if multiple users are trading ETH and USDC in the same batch, the assets will execute for the same price across the various trades. This makes transaction reordering useless, removing the opportunity for price exploitation.

Thanks to a powerful combination of delegated trade execution, batch auctions, and protected transaction flow through MEV Blocker, CoW Protocol users benefit from thorough MEV protection on all trades.

## CoW DAO protects you from MEV

MEV is a billion dollar problem for the Ethereum ecosystem. CoW DAO builds products to protect users from negative outcomes for transactions of all types and sizes.

DeFi traders can rely on  [CoW Swap](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=understanding-mev-article)  as the most trusted decentralized exchange when it comes to MEV protection. For all other use-cases, including liquidity providing, NFT trading, and more,  [MEV Blocker](https://mevblocker.io/)  provides extensive MEV protection anywhere on Ethereum.

If you want to learn more about MEV, check out “[MEV Transparency: Ensuring Fairness In DeFi Markets](/learn/mev-transparency-ensuring-fairness-in-defi-markets)” and “[How CoW Swap solves the MEV problem](/learn/how-cow-swap-solves-the-mev-problem).”

Safe trading!

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MEV is a billion-dollar problem, but many Ethereum users still don’t know how to protect themselves.


Understanding MEV Protection

_CoW Swap, a DEX trading platform, has undergone a remarkable transformation over the last few years._

_The platform has transformed substantially from its early days as a dutch auction swap to a leading authority on intents forging new ground through conditional programmatic orders. In a recent presentation, Alex Vinas, the Product Marketing Manager at CoW Swap, traced CoW Swap’s journey and offered insights into its history, pivotal developments, and the promise of the brand new_ [_Programmatic Order Framework_](/learn/introducing-the-programmatic-order-framework-from-cow-protocol) _(Please Note: At the time of the presentation, the Programmatic Order Framework was known as “Composable CoW.”)_

<iframe width="560" height="315" src="https://www.youtube.com/embed/6dA4V_yYn8A?si=M5UYcWadWAU5Mifo" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>

_What follows is a transcript of Alex’s talk:_

## A Brief History of CoW Swap

![1-navigating-the-evolution-of-cow-swap.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_navigating_the_evolution_of_cow_swap_ebc6a318b6.webp)

Cow Swap’s journey began back when its current team was a part of Gnosis. At the time, the team was working on decentralized mechanisms for trading prediction market outcomes. It was this work that helped bring to life the famous “x*y=k” formula for AMMs back in 2017 — earlier than even the founding of Uniswap.

### Dutch Auctions

While their initial ideas were good, Gnosis recognized the vulnerabilities of the traditional AMM design and its weakness toward MEV, so the team pivoted to Dutch auctions.

However, this mechanism also came with its own set of downfalls.

It worked well for initial coin offerings and wasn’t susceptible to MEV, however it fell short when faced with the growing diversity of tokens on Ethereum. Dutch auctions also had to compromise on speed, resulting in a slow trading experience for users.

### Batch Auctions

The team realized they needed a new auction mechanism for trading large amounts. It was here that the batch auction was born.

After cycling through several different iterations of batch auction DEX’s, CoW Protocol was born in 2021. CoW Protocol was built on the learnings from earlier projects and introduced innovative features like an intents-based architecture and comprehensive MEV protection.

The product was designed to address the challenges faced by retail users, smart contract accounts, and decentralized autonomous organizations (DAOs). At the core of the protocol is a delegated trading execution model in which bonded third parties known as “solvers” handle order execution on behalf of users.

The delegated trading model of CoW Protocol offers several benefits:

-   **For retail users**, it abstracts away Ethereum complexities such as gas fees, MEV, and the need to search for the most up-to-date AMM pools
-   **For smart contract wallets,** it enables a seamless trading experience. Before CoW Swap, smart contract wallets often had their trade execution paths expire by the time they gathered signatures. Today, smart contract wallets only commit to a particular  _price_  (rather than a specific trading path), leading to more flexibility and optimizing order execution
-   **For DAOs**, features like the  [Milkman](/learn/what-is-milkman-cow-swaps-solution-for-delayed-execution-trading)  contract bridge the gap in time between a governance proposal and an on-chain swap by allowing the DAO to specify an on-chain price feed from which to pull real-time prices (rather than specifying a fixed price)

### The Path Toward Smart Contract Intents

Initially, gasless trading was limited to EOAs since smart contract wallets don’t have private keys and thus can’t sign messages. It wasn’t until the introduction of  [ERC-1271](https://eips.ethereum.org/EIPS/eip-1271)  smart orders that gasless trading was enabled for smart contracts using a new method called “isValidSignature.” This allowed smart contracts to delegate order placement while maintaining control through interactive signature verifications.

The first implementation of smart orders in CoW Swap was the  [native ETH flow](https://medium.com/@cow-protocol/moooove-over-weth-native-eth-trading-is-now-live-on-cow-protocol-96f107e53a49)  which allowed traders to trade ETH just like they would any other ERC-20 token. The second implementation was the  [Milkman](/learn/what-is-milkman-cow-swaps-solution-for-delayed-execution-trading)  contract. Milkman protects governance-based swaps from price exploitation as users specify an on-chain data source from which to pull prices rather than specifying a fixed amount and slippage. This allows the “minOut” variable of a swap to be modular and enables much more streamlined governance-based swaps.

While ERC-1271 smart orders have advantages including conditional on-chain guarantees, they also have drawbacks: they are gas-heavy for autonomous execution, require trust in an intermediary contract holding funds, and are limited to one order per signature.

## Enter the Era of Programmatic Orders

Programmatic orders build on top of batch auctions to enable even more user-friendly, trustless, and autonomous trading.

Programmatic orders take advantage of ERC-1271 smart orders to unlock intents for smart contracts. This has been transformative for the ecosystem, as it allows smart contracts to delegate order placement while still ensuring secure and customizable trading conditions.

[The Programmatic Order Framework from CoW Protocol](/learn/introducing-the-programmatic-order-framework-from-cow-protocol)  allows users to execute unlimited smart orders in parallel, with enhanced gas efficiency and full self-custody. The Framework opens the door to a number of use-cases including automated fee collection, DAO payrolls, TWAP orders, and even private conditional orders such as stop-loss.

### Understanding the Programmatic Order Framework Architecture

Programmatic orders operate through a decentralized architecture that ensures trustless execution by holding assets in the user’s safe.

![2-navigating-the-evolution-of-cow-swap.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_navigating_the_evolution_of_cow_swap_93d6afc424.webp)

The Programmatic Order Framework involves four main customizable parameters which combine with the order handling of CoW Protocol to allow developers to deploy ANY codeable strategy.

Each conditional order has the following properties or data available at settlement:

-   _handler_  — verifies the conditional order parameters via a smart contract (Programmatic Order Framework)
-   _salt_  — allows for multiple conditional orders of the same type and data (Merkle root)
-   _staticData_  — data available to ALL discrete orders created by the conditional order
-   _offchainData_  — data optionally provided from off-chain to a discrete order

## The Future of Programmatic Orders

Programmatic Orders open a world of possibilities by allowing users to turn their Safes into autonomous traders. While the Programmatic Order Framework is currently developer-focused, it unlocks a wide range of use-cases for retail users as well. The integration of  [CoW Hooks](/learn/cow-hooks-you-are-in-control)  in the future could further enhance the user experience, combining composable smart orders with additional functionalities.

In conclusion, CoW Swap’s journey to perfect DeFi orders embodies the protocol’s commitment to users and innovation. The Programmatic Order Framework emerges as a pivotal milestone, showcasing CoW Swap’s adaptability and dedication to meeting the evolving needs of the crypto community.

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Navigating the Evolution of CoW Swap: From Market Orders to Programmatic Orders

## TL;DR

-   During the month of  **November**, CoW Protocol handled a total volume of  **$1.49B**, and generated a surplus of  **$11.2M**
-   In terms of Governance, CoW DAO executed CIP-33 and received two important CIP drafts in regards to charging protocol fees and changing the method in which the protocol collects fees
-   In exciting news, CoW Protocol launched a new class of orders called “Programmatic Orders,” launched a configurable CoW Swap widget, took over Istanbul during Devconnect, and participated in several Twitter spaces and podcasts

## Protocol Stats

This month, CoW Protocol settled a total of  **$1.49B.**

![1-November-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_November_2023_highlights_ff892a4ef9.webp)

The top 3 batches worth highlighting are the following:

-   **Batch with the highest % of CoW trades**  ([Transaction details](https://explorer.cow.fi/tx/0x3dea3947bfd480bdfed6251c4a31ff4d040c14cc430338afa110ba7885e3de17?tab=graph)**)**. The total batch volume was  **$747,799.76** , and it was created by two traders who were perfectly CoWed for  **98%**  ($734,793.86) of their volume. One trader was buying tBTC for  **$371,378.52**, and the other trader was selling tBTC for  **$384,428 via a partially fillable limit order**.

![2-November-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_November_2023_highlights_2d2caf95bb.webp)

-   **Batch containing the highest volume**  ([Transaction details](https://explorer.cow.fi/tx/0x0c41ee0a2d1c75034c9258579069dd2e8e7a2a5e59703865e2c0ac47343102c7?tab=graph&vis=transfers)**)**: The total batch volume was  **$8,813,659** and it was created by a single trader who was swapping  **$8.8M of USDT**  **for**  **$8.7M of USDC**.

![3-November-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_November_2023_highlights_550a6dba21.webp)

-   **Batch with the highest amount of surplus**  ([Transaction details](https://explorer.cow.fi/tx/0xb9a63242596218936cb0cd83d2cc460bf7504c563d54a4c2b3e8674f38975d20/?tab=graph&vis=transfers)**)**: The total batch volume was  **$133,898** and it was created by a single trader who was swapping  **RLB**  **for**  **USDC**. This trader achieved the largest surplus for the month of  **November**  by getting 99.33% surplus, which at the time of trade was roughly $**133,002 USDC**, proving once again that solvers are here to improve your trades, not to attack them.

![4-November-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_November_2023_highlights_90bab101e1.webp)

During the month of  **November**, the top 10 traders traded a total of  **$56M.**

![5-November-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_November_2023_highlights_79e346c7a3.webp)

In the table below you can see the total volume for this month’s biggest trades. The most active trader executed a whopping  **$27M**  in trades with CoW Protocol this month.

![6-November-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_November_2023_highlights_de62650639.webp)

## Solvers

In  **November**, solvers generated a total of  **$11.2M**  in surplus, which is money in the pockets of traders.

![7-November-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/7_November_2023_highlights_09eda2bfdd.webp)

Below you can find a breakdown of how each solver performed in November.

![8-November-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/8_November_2023_highlights_a807afb001.webp)

## Governance

It has been a steady month in terms of governance! The CoW cannot be stopped 💪

### Executed Proposals

This month the DAO executed one important proposals:

-   [CIP-33: Should the CoW Treasury Core unit be added to the MEVBlocker Rebates Safe?](https://snapshot.org/#/cow.eth/proposal/0x999a4840ecb71e7edb4102caf19ea5f9ee7b237ece649a0d22eec74f7c1f1c16)

### Draft Proposals

This month, there was 2 new proposals asking for feedback before moving into the next phase, final CIPs, in their current form:

-   [CIP-Draft: Testing Fee Models for CoW Protocol](https://forum.cow.fi/t/cip-draft-testing-fee-models-for-cow-protocol/1984)
-   [CIP-Draft: Solver Computed Fees & Rank by Surplus](https://forum.cow.fi/t/cip-draft-solver-computed-fees-rank-by-surplus/2061)

Make sure to read them and leave comments — your feedback is highly appreciated and will help move these important topics forward. If you are interested in submitting a proposal to the CoW DAO, make sure to use the following  [template](https://forum.cow.fi/t/cip-0-template/28).

## CoWmunity News

-   [Launched a new class of orders with the release of the Programmatic Order Framework](https://x.com/CoWSwap/status/1722735351972983030?s=20)
-   [Launched a CoW Swap widget](https://x.com/CoWSwap/status/1724037068610056354?s=20)  to make it easier for projects to integrate with CoW Protocol and enjoy its benefits
-   [Proposed to CoW DAO an entirely new fee collecting method](https://x.com/CoWSwap/status/1729508014686601621?s=20)  aimed to reduce the selling pressure of $COW tokens by solvers.
-   [Took over Istanbul with our packed participation across different events during the Devconnect week](https://x.com/CoWSwap/status/1722341346827202687?s=20). Here are all the available talks:
  → Arbitrageurs’ profits, LVR, and sandwich attacks: batch trading as an AMM design response
-   Intent.wtf →  [Talk](https://www.youtube.com/watch?v=-OXMPmpzFXU)  → Advancing Beyond Swap Intents |  [Panel](https://www.youtube.com/watch?v=1gxweVY9edU)  → The Role of Intent-Driven Transactions in DeFi’s Evolution
-   Good intentions →  [Talk](https://www.youtube.com/watch?v=CTwC204N-68)  → CoW Swap more than swap intents |  [Panel](https://www.youtube.com/watch?v=4n2ChWn1ksQ)  → Intents and MEV Panel
-   Decentralized Scaling summit →  [Talk](https://www.youtube.com/watch?v=evyjRRteZCg)  → The rise of smart orders |  [Panel](https://www.youtube.com/watch?v=v4Y-hf5BTWk)  → How do we balance privacy and surveillance?
-   MEV & Intents Day →  [Talk](https://www.youtube.com/watch?v=hoFVSFn181Y)  → The rise of smart orders |  [Panel](https://www.youtube.com/watch?v=xauLHm98zYc)  → Intents
-   [Sponsored the ETH Global Hackthon Istanbul where we had a great list of submissions for our bounties](https://x.com/CoWSwap/status/1726242733466280436?s=20)
-   Appeared on  [the Bell Curve Podcast to do a breakdown of Frequent Batch Auctions](https://x.com/thebellcurvepod/status/1725193559748272441?s=20), covering why they are superior to other auction types when it comes to DEX trading
-   [Mastercow launched his own treasure hunt](https://x.com/CoWSwap/status/1725579868581306859?s=20)  to make developers race for a treasure and understand the inner workings of the new Programmatic Order Framework
-   [Brave wallet improved the signing modal for CoWSwap](https://x.com/CoWSwap/status/1723027440472400107?s=20)  trades to make it easier for their users to understand what the intent they were signing was
-   Wrote an article about the DAO tooling product “[Milkman](https://x.com/CoWSwap/status/1727326002202935304?s=20)” explaining what it is, and how it works to your DAO’s benefit
-   Joined a Twitter space organized by Taiko debating if “[intents exists outside of Twitter](https://x.com/CoWSwap/status/1729818776013840586?s=20)”
-   Got featured by Chainpatrol.io on  [“Case studies in web3 brand protection”](https://x.com/ChainPatrol/status/1720096549009838328?s=20)
-   Covered CoW Swap in  [Spanish extensively at the DeFi Lab podcast](https://x.com/DeFi_LaB/status/1720113820624974279?s=20)
-   Wrapped up the MEV series articles with our latest article explaining  [what backrunning is](https://x.com/CoWSwap/status/1720143397527368001?s=20)
-   Posted a draft on the  [CoW DAO forum listing the reasons on why adding a protocol fee for CoW Protocol](https://x.com/CoWSwap/status/1720513622474920157?s=20)  is beneficial to the ecosystem and how CoW DAO should approach it
-   CoW Swap got  [integrated into Caddi Finnance](https://x.com/CoWSwap/status/1721559378401034573?s=20)
-   Jumped on a twitter spaces with Diego Defi to explain to our  [Hispanic community what CoW Swap is](https://x.com/diego_defi/status/1721921766132478295?s=20)  (Alta falopa ;) )

## Product Updates

**Backend**

The backend team has been working hard to improve the product infrastructure. In  **November**, we:

-   Worked on several Driver Colocation tests in prod for the new solver set up
-   Fixed error parsing score_cap CLI argument (caused slightly suboptimal score bidding)
-   Optimised driver pipeline (solve → encode → verify / simulate)
-   Worked on several performance optimization fixes for fetching liquidity for quoting
-   Worked on the liveness/readiness probe for the driver to improve rollover when deploying to the cluster
-   Migrated shadow competition to colocated setup (helps debug performance issues)
-   Worked on several performance improvements for the Enso simulator used in the solver submission checks

**Frontend**

The frontend team has been pushing hard for several improvements in the UI front, as well as the overall UI infrastructure. In  **November**, we:

-   Worked on the landing page for the CoW Swap widget, as well as on the configurator website
-   Widget codebase has been reiterated a few times
-   Improved the performance of loading balances on the CoW Swap UI
-   Improved the robustness of the WatchTower for TWAP orders
-   Worked on expanding the WatchTower capabilities to allow the indexing of all new programmatic order types by implementing an allow/deny list
-   Added widget theming 🌈 to allow teams to configure it to their branding

## Open Job Positions

The CoW Protocol team is currently not hiring

Welcome back to another CoW update, where we break down the most notable developments of the last few weeks at CoW Protocol.

CoW Protocol November 2023 Highlights

_Blockchains enable reliable, trustless transactions on a large scale, however the automated nature of the technology leaves room for price manipulation by bots and malicious actors. In this talk, Olga Fetisova of CoW Protocol takes a look at Maximal Extractable Value (MEV) and its impact on the Ethereum ecosystem._

_The first part of the talk focuses on defining MEV and considering metrics, while the second part covers transparency initiatives, challenges, and solutions._

<iframe width="560" height="315" src="https://www.youtube.com/embed/hbgJYZlSU1k?si=IXHbjvmu9cdhWKC4" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>

_What follows is a transcript of Olga’s talk:_

## What is MEV?

![1-mev-transparency-a-dappcon-talk.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_mev_transparency_a_dappcon_talk_f6131f7a7a.webp)

Blockchain technology is great at ensuring the validity of all transactions and creating new blocks with no downtime, however not all transactions are ordered in the same manner that they are submitted.

While block producers have full autonomy over selecting which transactions to include in each block, they usually opt to maximize profits by ordering transactions based on the highest gas price. This means that validators may censor or re-order transactions before creating the block. Re-ordering transactions with a profit motive is known as “maximal extractable value” (MEV).

In other words, MEV is the profit extracted by miners or other actors in the blockchain network who insert, remove, and re-order transactions.

According to  [Flashbots](https://www.flashbots.net/), a research and development organization focusing on MEV, over $500 million in MEV has been extracted just since The Merge. This value is only the recorded amount paid out to Ethereum validators; the attackers themselves have earned much more.

As we can see, MEV creates a set of skewed incentives. On certain days, Ethereum validators earn more ETH from extracting MEV than from network fees themselves.

Some MEV activities are indeed legitimate, as the practice makes sure that transactions are ordered in an optimal way. Overall, however, the practice creates unfair advantages for a small minority.

Today we will talk about the most common types of MEV.

**Frontrunning attacks**

Frontrunning is when a bot sees a profitable transaction in a public mempool, duplicates it, and places their own order in front of the victim transaction, extracting its value for themselves.

**Backrunning attacks**

Very similar to frontrunning, but in reverse. In backrunning, the attacker places a transaction after the victim transaction to capitalize on any arbitrage left by the victim’s order.

Frontrunning and backrunning transactions are not very common by themselves, but a combination of the two, known as a “sandwich attack,” accounts for most MEV.

**Sandwich attacks**

Sandwich attacks combine frontrunning and backrunning, placing a buy order before the victim transaction and a sell order directly after. This creates a “sandwich” of the victim transaction.

Let’s take a deeper look into sandwich attacks.

## Sandwich attacks on the blockchain

![2-mev-transparency-a-dappcon-talk.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_mev_transparency_a_dappcon_talk_8e1295469d.webp)

A sandwich attack begins after a user places a transaction in the mempool.

During order placement, the user indicates a slippage tolerance. Slippage is the necessary deviation in price that a trader is willing to accept for their transaction. Since the user indicates that they are willing to accept a particular sub-optimal price, MEV bots take this opportunity to exploit the price of the asset and capture the value for themselves.

The bot frontruns the user by placing a transaction directly in front of the victim’s trade. This strategically raises the price of the token by the exact amount necessary to make the victim transaction clear at its maximum slippage tolerance.

After the user’s transaction goes through (at the max slippage), it pushes the price of the asset up even further. The bot places a sell transaction (backrunning) directly after, benefiting from this artificial price arbitrage.

In essence, the bot places a transaction at a low price, rides the user’s slippage and price impact up, and sells at a higher price.

The user loses out, as they have to pay more than they would have otherwise and they receive fewer tokens for their trade. This is not fair.

## MEV Attacks in Practice

We can look at the chain to examine sandwich attacks directly. If we see the same token trading multiple times in one block, this may be an indicator that MEV attacks are occurring.

![3-mev-transparency-a-dappcon-talk.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_mev_transparency_a_dappcon_talk_0bf4aae45b.webp)

In a block analyzed by the research organization  [ZeroMEV](https://zeromev.org/block?num=15956603), we can see that the DAI token was traded multiple times, suggesting actions by MEV bots.

The ZeroMEV analysis indicates that this block contains nearly $40 of lost value. The last transaction in the block was a payment to the miner in the form of 0.41 ETH, meaning that the attacker themselves earned an even higher amount.

![4-mev-transparency-a-dappcon-talk.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_mev_transparency_a_dappcon_talk_6d599f75e5.webp)

To put this into perspective, the average MEV payout per block is about $100. On certain days of volatile market activity, however, this value can be much higher.

![5-mev-transparency-a-dappcon-talk.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_mev_transparency_a_dappcon_talk_f76cf0cd60.webp)

![6-mev-transparency-a-dappcon-talk.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_mev_transparency_a_dappcon_talk_aa4faee6ce.webp)

Looking at  [a block from November 2022](https://zeromev.org/block?num=15957277)  around the time of the FTX crash, we can see a completely different set of numbers.

In just one block, a bot caused over $5,000 in user losses and the validator received a kickback of over 3.5 ETH, suggesting, once again, that the gains for the MEV bot were significantly higher.

One notorious MEV searcher is known as “jaredfromsubway.” In a report by  [The Block](https://www.theblock.co/post/230218/jaredfromsubway-mev-bot), this searcher earned $34 million through MEV extraction in just the span of 3 months.

Using  [on-chain data](https://transparency.flashbots.net/), we can break down MEV price exploits by DEX. In the below image, we can see that Uniswap V2 and V3 account for over 90% of all MEV attacks on Ethereum.

![7-mev-transparency-a-dappcon-talk.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/7_mev_transparency_a_dappcon_talk_d48aacf263.webp)

This, of course, is primarily as a result of Uniswap capturing the majority of trading liquidity — the more trades, the more potential MEV.

Thankfully, it’s quite simple to check if you have been MEV attacked. One of the easiest methods is by entering your Ethereum address on  [ZeroMEV’s website](https://zeromev.org/). You can also use a transaction hash or a particular block number.

![8-mev-transparency-a-dappcon-talk.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/8_mev_transparency_a_dappcon_talk_60f3ba93f7.webp)

## Transparency Initiatives

Several organizations specialize in tracking MEV. These include Flashbots, Eigenphi, and ZeroMEV, among others. There are, however, practical ways that you can protect yourself from MEV exploits.

One of the most effective methods involves using a specialized RPC (remote procedure call) endpoint. RPC endpoints send calls to the blockchain for data and stand as an intermediary between your wallet and the blockchain itself.

RPC endpoints can be swapped out by the user depending on their needs. Most wallet applications such as MetaMask make it relatively straightforward to add custom RPC endpoints. Some well-known examples of specialized RPC endpoints include  [MEV Blocker](https://mevblocker.io/),  [MEV-Share](https://docs.flashbots.net/flashbots-protect/mev-share), and  [BackRunMe](https://backrunme.com/).

## MEV Blocker

![9-mev-transparency-a-dappcon-talk.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/9_mev_transparency_a_dappcon_talk_08bc87a2fd.webp)

[MEV Blocker](https://mevblocker.io/)  was developed by CoW DAO and, as the name suggests, it provides MEV protection for users.

When a user submits a transaction using MEV Blocker, rather than sending it to the public Ethereum mempool, the RPC sends the transaction to a specialized private pool. This conceals the transaction from public exposure, protecting it from exploitation by MEV searchers.

As an extra layer of security, MEV Blocker generates fake transactions that prevent probabilistic exploitation by advanced searchers. In addition, MEV Blocker offers rebates on trades by capturing value from potential backrunning opportunities. If a user transaction creates a backrunning opportunity, MEV Blocker guarantees that at least 90% of the backrunning value will be forwarded back to the user in the form of a rebate.

While it’s relatively new, MEV Blocker has already enjoyed a meteoric rise. So far, the RPC endpoint accounts for $16 billion in protected volume and 370 ETH in user savings.

To add MEV Blocker to your wallet, check out the MEV Blocker website:  [https://mevblocker.io/](https://mevblocker.io/)

## Dedicated dApps

While RPC endpoints protect against price exploitation, the most extensive MEV protection comes at the application layer.

One dApp that provides comprehensive MEV protection is  [CoW Swap](https://swap.cow.fi/). CoW Swap is a meta-DEX aggregator that matches orders with the best liquidity available on-chain and protects trades from MEV exploitation.

CoW Swap actually sends all transactions through MEV Blocker by default, but the dApp also uses some extra techniques to combat MEV.

1.  **Delegated Trade Execution**: On CoW Swap, dedicated parties known as “[solvers](https://docs.cow.fi/solvers/solvers)” execute transactions on behalf of the users. This means that users are never directly exposed to the chain, as they only sign an “intent to trade” message which the solvers execute as a blockchain order.
2.  **Coincidence of Wants (CoW)**: CoW Swap enables users to trade off-chain with each other through a peer-to-peer trading mechanism. These trades don’t have to go through the public mempool, so they avoid the dangers lurking there.
3.  **Uniform Clearing Prices**: Transactions on CoW Swap get grouped together into “batches.” Each time a particular asset (such as WETH) trades in a batch, it trades for a constant price. This mechanism obviates the price advantages of reordering transactions, preventing MEV exploits.

These two categories of protection — RPC endpoints and dedicated dApps — are the current ways that we can protect ourselves from MEV attacks. It’s important to remember, however, that MEV is a broader problem that evolves quickly, with bots constantly finding new ways to attack us and steal our precious ETH.

## Conclusion

There are many challenges in combating MEV.

For one, there is a lack of data availability. Centralized exchanges, for example, don’t share their data so it’s difficult to understand the full scale of the MEV problem and come up with a complete solution.

While lots of organizations focus on combating MEV, the issue continues to pose a significant challenge. This also creates opportunities, however, for the community to come together, innovate, and ensure that Ethereum remains the gold standard in the blockchain world.


large_mev-transparency-a-dappcon-talk-cover-photo.png

medium_mev-transparency-a-dappcon-talk-cover-photo.png

small_mev-transparency-a-dappcon-talk-cover-photo.png

thumbnail_mev-transparency-a-dappcon-talk-cover-photo.png

mev-transparency-a-dappcon-talk-cover-photo.png

A DappCon Talk by Olga Fetisova of CoW DAO


MEV Transparency: Ensuring Fairness In DeFi Markets

On CoW Protocol, rather than sending on-chain transactions with predefined swap instructions, users submit signed  [intent-to-trade messages](/learn/cow-protocol-glossary#:~:text=Intent%20to%20Trade). These messages contain some order details, like which assets to trade in which amounts, but leave other details to be optimized by  [solvers](https://docs.cow.fi/cow-protocol/tutorials/solvers).

One important parameter of these intents is min_out — the minimum amount of buy tokens a user is willing to receive for their sell tokens (or the buy amount, minus the maximum allowable slippage set by the user). Min_out works really well when a trade is intended for immediate or near-immediate execution, because it allows solvers to improve prices for users while protecting them from unfavorable price movements. However, when prices fluctuate a lot, min_out can be overly-restricting.

## **What is delayed execution trading?**

Simply put, delayed execution trades are trades intended to execute at some point far in the near future.

Many smart contract wallet users, such as DAOs, frequently need to create these types of orders. Take the following examples:

-   DAOs that need trades to execute after passing a governance process
-   Groups that need hours to collect signatures to execute trades from a multisig wallet
-   Applications that process automated swaps years in the future (e.g. for payroll or treasury management)

With extra time, prices can fluctuate wildly — and this creates a dilemma for traders:

If the buy token price falls and the min_out is too high, the order might not execute. But if the min_out is too low, the trader risks getting an unnecessarily poor execution price. (CoW Protocol solvers compete against each other to give users better prices, but placing such a high level of trust in solvers can be undesirable for very high-volume traders.)

![1-what-is-milkman.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_what_is_milkman_0518ebe1f4.webp)

If a user signs an intent to swap 1 ETH for a “min out” of 2000 USDC, there is no way for the trade to return any less than 2000 USDC

![2-what-is-milkman.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_what_is_milkman_08ab1cbaac.webp)

But setting a low “min out” risks leaving money on the table

## **What is Milkman?**

Milkman is a smart contract that solves the above dilemma for smart contract wallets.

It does this by allowing smart contracts to specify an on-chain data source (such as an oracle) to use as a reference for min_out — effectively turning min_out into a dynamic price backstop for their trade.

Let’s say you want to sell 1000 ETH for USDC, but you want to do it far in the future. To protect yourself from volatile price movements, you can supply Milkman to create the order based on with the Chainlink price feed for ETH/USDC, and Milkman at the time of order placement will dynamically adjust the minimum amount you’ll receive based on that price feed.

When the time comes to execute your trade, CoW Protocol will receive it with a min_out that accurately reflects prices at that point in time; and solvers will compete to improve the price on top of that, as they always do.

![3-what-is-milkman.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_what_is_milkman_7f4ab32979.webp)

## **Milkman for DAOs**

Milkman is particularly well-suited to many DAO-related use cases, because DAO governance processes often delay trades and because amounts traded by DAOs can be very large.

Several well-known DAOs, including  [Aave](/learn/aave-trade-breakdown)  and  [ENS](/learn/ens-trade-breakdown), have already used Milkman to trade over $20M worth of tokens. Beyond allowing these DAOs to count on reliable prices, Milkman lets them reduce their overall number of governance votes and gives them standard CoW Swap benefits like best price execution and  [best-in-class](https://eigenphi.substack.com/p/sandwich-mevs-impact-on-cow-swap)  MEV protection — critical for large trades.

Milkman is also natively integrated as a  [recipe on Tally](/learn/tally-recipe-for-cow-swaps), the widely-used DAO management platform — removing even more trading friction for DAOs.

## **Technical details**

Milkman follows a UniV2-style interface. To interact with Milkman, smart contracts need only to call the following function:

> _function requestSwapExactTokensForTokens(_
> 
> _uint256 amountIn,_
> 
> _IERC20 fromToken,_
> 
> _IERC20 toToken,_
> 
> _address to,_
> 
> _address priceChecker,_
> 
> _bytes calldata priceCheckerData_
> 
> _)_

The priceChecker is the data feed provider, and priceCheckerData is an array of arbitrary bytes that the function passes to the price checker (e.g. the desired slippage tolerance).

Price checkers have been deployed for Chainlink, Curve, SushiSwap, Uniswap V2, Uniswap V3, and combinations of these. The core Milkman code can be found  [here](https://github.com/cowdao-grants/milkman). Anyone can run a  Milkman bot, which simply functions as a hook that watches for new swap requests and surfaces them to CoW Protocol. Running a bot is fairly easy if you have a Kubernetes cluster; the instructions are in the repo.

Milkman was developed by  [Yearn Finance](https://yearn.fi/)  in partnership with CoW Protocol, through the  [CoW Grants Program](https://grants.cow.fi/).

Long live Milkman! And may you benefit from his commitment to bringing you favorable prices!

![4-what-is-milkman.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_what_is_milkman_185027226b.webp)


large_what-is-milkman-cover-photo.webp

medium_what-is-milkman-cover-photo.webp

small_what-is-milkman-cover-photo.webp

thumbnail_what-is-milkman-cover-photo.webp

what-is-milkman-cover-photo.webp

Milkman is a simple contract that lets DAOs and other smart contract wallet users set dynamic price backstops for orders that will execute in the future!


What is Milkman? CoW Swap’s Solution for Delayed Execution Trading

## TL;DR

-   During the month of October, CoW Protocol handled a total volume of  **$998M**, and generated a surplus of  **$6.3M**
-   In exciting news, CoW Protocol launched  [fully gasless transactions](https://twitter.com/CoWSwap/status/1714633297408696409?s=20),  [dressed up for Halloween](https://x.com/CoWSwap/status/1717873465028682130?s=20), got some  [love from Binance Research](https://x.com/CoWSwap/status/1714387540457947396?s=20), and much more

## Protocol Stats

This month, CoW Protocol settled a total of **$998M.**

![1-october-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_october_2023_highlights_132809a9ad.webp)

The top 3 batches worth highlighting are the following:

**Batch with the highest % of CoW trades**  [(Transaction details)](https://explorer.cow.fi/tx/0x924c98ee2a6da650ce0828a2bc722c35f6924e4b490c5ed41f4153f75d85f8aa?tab=orders): The total batch volume was  **$3,078,084.40,** and it was created by two traders who were perfectly CoWed for  **51% ($1,576,169.65)** of their volume. One trader was buying  **DAI for FRAX**, and the other trader was buying  **FRAX for DAI**.

![2-october-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_october_2023_highlights_d343c2eba3.webp)

**Batch containing the highest volume**  [(Transaction details)](https://explorer.cow.fi/tx/0x9b86f6189c18116fadccb4f262b6cd5bb41c77ab5a988663dc8424b6f89809b3?tab=orders&vis=transfers): The total batch volume was  **$9,150,950.72** and it was created by three traders who were swapping  **DAI**  to  **USDC, DAI** to **ETH, and ETH** to **JOE**.

![3-october-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_october_2023_highlights_a69b0be379.webp)

**Batch with the highest amount of surplus**  [(Transaction details)](https://explorer.cow.fi/tx/0x6413df8b8351d6177af1da8b0bc0440e01b7a5f160d3d3802c3f784636c7f165/?tab=orders&vis=transfers): The total batch volume was  **$9987,355** and it was created by a single trader who was swapping  **USDC**  **to ETH**. This trader achieved the largest surplus for the month of October by getting 62 ETH, which was roughly  **$100K (11% surplus),**  extra.

![4-october-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_october_2023_highlights_00ed78e3c6.webp)

During the month of  **October**, the top 10 traders traded a total of  **$71M.**

![5-october-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_october_2023_highlights_1b9fdad0ec.webp)

In the table below you can see the total volume for this month’s biggest trades. The most active trader executed a whopping  **$66M**  in trades with CoW Protocol this month.

![6-october-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_october_2023_highlights_81ec197430.webp)

## Solvers
In  **October**, solvers generated a total of  **$6.3M**  in surplus, which is money in the pockets of traders.

![7-october-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/7_october_2023_highlights_04c5a108b4.webp)

Below you can find a breakdown of how each solver performed in October.

![8-october-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/8_october_2023_highlights_8a1bd1b03b.webp)

## Governance

It has been a hectic month in terms of governance. CoW DAO executed 3 proposals! After a relaxing month in September, the CoWs came back in force for October 💪.

![9-october-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/9_october_2023_highlights_c5eeb5d39e.webp)

### Executed Proposals

This month the DAO executed three important proposals:

-   [CIP-31: Change CoW DAO’s (cow.eth) Snapshot space settings](https://snapshot.org/#/cow.eth/proposal/0x6dd13bfc9eae35a5f597cea373f21947d4c701ba7ce065c66934c560847484cc)  (As well as  [CIP-31.2: Change CoW DAO’s (cow.eth) Snapshot space settings](https://snapshot.org/#/cow.eth/proposal/0xf6ff58bd97c8c591d0fd4db3a9082864b7fa85c45734234af49f61f7f770cfb8))
-   [CIP-32: MEV Blocker Funding](https://snapshot.org/#/cow.eth/proposal/0x18ed839f7e3f10615ca28fe05b164856ba4e9cfa5f7d7f7a5fcbc89523392560)
-   [CIP-33: Should the CoW Treasury Core unit be added to the MEVBlocker Rebates Safe?](https://snapshot.org/#/cow.eth/proposal/0x999a4840ecb71e7edb4102caf19ea5f9ee7b237ece649a0d22eec74f7c1f1c16)

### Draft Proposals

This month, there was one new proposal asking for feedback before moving into the next phase, a final CIP, in its current form:

-   [CIP-Draft: Testing Fee Models for CoW Protocol](https://forum.cow.fi/t/cip-draft-testing-fee-models-for-cow-protocol/1984/1)

Make sure to read the CIP draft proposal and leave comments — your feedback is highly appreciated and helps move these important topics forward. If you are interested in submitting a proposal to the CoW DAO, make sure to use the following  [template](https://forum.cow.fi/t/cip-0-template/28).

## CoWmunity News

-   Announced  [gasless approvals](https://twitter.com/CoWSwap/status/1714633297408696409?s=20), reducing CoW gas emissions and enabling fully ETH-less trading for a wide range of tokens
-   For Halloween, the CoW Swap website got a  [spooky makeover](https://x.com/CoWSwap/status/1717873465028682130?s=20)  including a custom theme,  [Halloween-themed fortune cookies](https://x.com/CoWSwap/status/1718609373973324187?s=20), and a  [special Layer3 Quest](https://x.com/CoWSwap/status/1719021671372533793?s=20)
-   Stackly launched a  [DCA solution built on top of CoW Protocol](https://x.com/CoWSwap/status/1716533044117389624?s=20)  to Mainnet
-   CoW Swap received coverage in a Binance Research report on  [intents](https://x.com/CoWSwap/status/1714387540457947396?s=20)
-   The team hosted an Intent.wtf  [Twitter space](https://x.com/CoWSwap/status/1716762010442940724?s=20)  with Particle Network and the Enso solver
-   The team  [hosted a happy cow-hour](https://x.com/CoWSwap/status/1715321314594955532?s=20)  on Discord unveiling the new solver-driver architecture. As a special community treat, the team waived all CoW Swap fees for the duration of the hour
-   A grant proposal for the development of a Milkman Safe App  [passed in voting](https://snapshot.org/#/cowgrants.eth/proposal/0x37cb0d505bed0e78283b69779dc6e963382f3a0f050026c4e3ced565a48d3710)  on Snapshot
-   The CoW Protocol team published several articles to the blog:  [Announcing Gasless Approvals on CoW Swap](https://blog.cow.fi/announcing-gasless-approvals-on-cow-swap-0bb803d900c2),  [What is Backrunning? — MEV Attacks Explained](https://blog.cow.fi/what-is-backrunning-mev-attacks-explained-38692250690c), and  [Understanding Order Flow Auctions](https://blog.cow.fi/understanding-order-flow-auctions-5532d4ef2f40)

## Open Job Positions

The CoW Protocol team is currently not hiring





Welcome back to another monthly CoW update, where we break down the most notable developments of the last few weeks at CoW Protocol.


CoW Protocol October 2023 Highlights

As a pioneer in the field of intents, CoW Swap has consistently brought faster, easier, and safer trading to DAOs and DeFi enthusiasts.

As DeFi grows and transactions become ever-more complex, the friction of having to sign and make orders manually becomes more pronounced. Traders looking to place recurring orders as a part of a complex trading strategy, DAO operators responsible for managing a treasury, and individuals tired of signing repetitive transactions could all benefit from a system that allows for automated order placement.

Today, CoW Protocol is proud to announce the release of two features that take the pain out of order placement and open up a wide range of possibilities for automation.

To start off, we’re introducing a new order primitive to the world of DeFi. We call it “Programmatic Orders”. Programmatic Orders are orders that create more orders. They require just one signature to create, then execute when on-chain conditions (prices, volumes, balances, times, etc.) are met. Programmatic Orders can execute indefinitely into the future, automating everything from complex trading strategies to advanced order types, portfolio management, DAO operations, and more.

Alongside Programmatic Orders, CoW Protocol is launching the Programmatic Order Framework. As the name implies, it’s a framework that allows for the easy creation of Programmatic Orders.

Below, we take a deeper look at Programmatic Orders, the Programmatic Order Framework, and the technical details necessary for implementation. We also call on the DeFi ecosystem to submit proposals for building applications on top of the Programmatic Order Framework through the  [CoW Grants Program](https://grants.cow.fi/).

## The current state of programmatic actions

The DeFi space currently supports very simple programmatic actions — for example, individual limit orders. Unfortunately, users have to trust a centralized operator to execute these actions correctly and fairly.

Despite the rise of autonomous agents in the wake of initiatives like ERC-1271, the vast majority of interactions are performed manually, which means there is a dependency on individuals, and a central point of failure.

Even when orders are executed properly, users still have to sign a transaction every time they want to place a new order. This may not be an issue for one-off transactions, but it starts to become a nuisance for frequent, recurring transactions.

The Programmatic Order Framework is built to address these problems.

## The Programmatic Order Framework: A decentralized solution for automated orders

At its core, the Programmatic Order Framework brings simplicity to order creation by automating the boilerplate code necessary for order placement. This allows DeFi users to programmatically create any set of orders and automatically approve them for execution with just a single signature.

Users can create advanced order types (such as Stop Loss and TWAP orders), automate DAO payrolls, and create or destroy multiple orders with just one on-chain transaction. Thanks to a “WatchTower” relayer, orders built with the Programmatic Order Framework execute automatically whenever certain on-chain conditions are met, eliminating the need for tedious and repetitive signatures for programmatic actions.

The framework is a plug-and-play system that takes in order logic and executes orders in perpetuity based on on-chain conditions. Creating orders only requires coding the order logic itself. The rest of the swap components like order creation, order validation, signature validation, API calls, order placement, and order settlement are provided by the framework itself.

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The key unlock of the Programmatic Order Framework is the low cost of deploying, updating, and deleting orders in large quantities. Developers only need to write code specifying the particular type of order they’d like to execute and the framework takes care of everything else — storing the data, validating parameters, and placing orders.

The WatchTower relayer verifies that order conditions are met, validates the order signature, and places the order on behalf of the user’s smart contract. To make deploying Programmatic Orders easy, CoW Protocol runs a default WatchTower that users can route orders through. However, users can also run their own WatchTower instance for maximum privacy.

## The all-in-one order automation kit

With the Programmatic Order Framework, a single signature can create hundreds of Programmatic Orders. The WatchTower monitors on-chain order conditions continuously and places orders whenever these conditions are met.

For example, a DAO with a diverse treasury can set up conditional orders for each token within its treasury. Based on these conditions, the framework may initiate a swap to rotate into stables when the treasury value rises above a certain threshold, or it may initiate a payout for DAO contractors on a given day of the month.

As the treasury receives various tokens, the framework executes trades accordingly, making DAO financial operations simple and automatic.

## Benefits of the Programmatic Order Framework

The Programmatic Order Framework unlocks a world of convenience for individuals and on-chain organizations:

-   **Leverage on-chain conditions**: Build highly complex use-cases that rely on custom conditional order logic through the Programmatic Order Framework. Create orders that get picked up by the WatchTower on a certain date, once the balance of your contract or wallet is above a defined threshold, or based on other on-chain conditions
-   **Deploy orders en masse**: Create hundreds or even thousands of orders with a single on-chain transaction. Developers can also mass-update orders all at once with a single gas payment by simply updating the Merkle root with another transaction
-   **Execute many orders in parallel**: In a traditional smart contract wallet, orders execute sequentially. With the Programmatic Order Framework, the WatchTower monitors your orders and executes them as soon as the on-chain conditions are met, meaning you can execute many orders simultaneously

Most importantly, the framework is  **fully decentralized**, providing 100% trustless execution with no intermediate contracts or centralized parties.

## Examples & use-cases

With the Programmatic Order Framework, you can program a limitless number of use-cases:

-   **Special order types**: Gone are the days of centralized exchanges offering order types you can’t get in DeFi. Program intricate order types like stop-loss, good-after-time, and take-profit orders — plus many more. CoW Swap’s very own  [TWAP feature](/learn/why-twap)  is built using the Programmatic Order Framework
-   **Automated DAO operations**: Blockchain-native organizations like DAOs process hundreds or even thousands of transactions every month. Thanks to the Programmatic Order Framework, your DAO can automate payroll, treasury diversification, fee collection, or any other type of repetitive transaction
-   **Portfolio rebalancing**: Set up order logic to programmatically rebalance assets based on a portfolio value. Automatically diversify based on market conditions or use custom logic to manage loan risk, farm yield, or hedge positions
-   **Private conditional orders**:  Thanks to the framework’s support for private WatchTower configurations, traders can place highly complex conditional orders while simultaneously keeping them private. Buy and sell tokens through a recurring strategy while keeping your parameters hidden
-   **Protocol integrations**: The Programmatic Order Framework isn’t  _just_  for Safe! DeFi protocols can leverage its power to assist with recurring protocol-level transactions like loan liquidations
-   **Easy transaction modules**: Program custom functionality into any order type. Companies can build DAO tooling with a fraction of the complexity. Focus on building adoption rather than fiddling with backend tech

With just a few lines of code, the Programmatic Order Framework brings convenience and predictability to all types of DeFi actions.

## What will you build, anon?

CoW Protocol is bringing Programmatic Orders to Ethereum through the Programmatic Order Framework. Create any order type you can imagine and deploy it instantly — all within the security of your own smart contract wallet.

The  [CoW Grants Program](https://grants.cow.fi/)  is also putting out a request for proposals relating to the Programmatic Order Framework. Have an idea for a solution built on top of the framework (especially one that includes a UI)? Submit a grant proposal!

The Programmatic Order Framework is now live. Read the documentation  [here](https://hackmd.io/pmZX_qT2Q1yw59KiiT6TPQ)  to get started.

Have questions? The CoW Protocol team is here to help: join us on  [Discord](https://discord.com/invite/cowprotocol)  or send us a  [Twitter DM](https://twitter.com/CoWSwap).

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Programmatic Orders enable a world of possibilities in DeFi; they’re now easier to create than ever thanks to CoW Protocol’s Programmatic Order Framework

Introducing the Programmatic Order Framework, from CoW Protocol

## Overview

-   Backrunning is one of the three main types of MEV, but it’s the least harmful as it only involves capturing arbitrage left over after a large trade
-   When a trader places a large trade that artificially inflates the price of an asset on an AMM, an MEV bot can backrun the trade and profit from the arbitrage
-   CoW Swap eliminates backrunning opportunities through its delegated trading mechanism, while MEV Blocker pays out rebates for any backrunning opportunities user trades create when transacting anywhere on Ethereum

![what-is-backrunning-mev-attacks-explained-cover-photo.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/what_is_backrunning_mev_attacks_explained_cover_photo_7573e1bea9.webp)

Backrunning is a specific type of MEV (Maximal Extractable Value) which causes some traders to miss out on potential profit opportunities from their trades.

In practice, backrunning involves strategically executing a transaction immediately after another, high-value transaction. By doing this, the backrunning transaction capitalizes on the arbitrage opportunity left over from the  [price impact](/learn/cow-protocol-glossary#:~:text=Price%20impact) of the initial transaction.

Backrunning involves the tactical use of the information contained within the Ethereum mempool — a holding area for all pending transactions — to place transactions immediately after high-value trades in order to profit.

Out of the three types of MEV ([frontrunning](/learn/what-is-frontrunning),  [sandwich attacks](/learn/what-is-a-sandwich-attack-and-how-can-you-protect-yourself), and backrunning) backrunning is considered the least harmful. In fact, if performed by itself, this method simply captures the arbitrage opportunity left over by a large trade without affecting the initial trade itself. Backrunning is only harmful to the user when combined with a  [frontrunning attack](/learn/what-is-frontrunning), which results in the worst kind of MEV —  [the sandwich attack](/learn/what-is-a-sandwich-attack-and-how-can-you-protect-yourself).

For advanced traders who are capable of capturing the leftover arbitrage from their trades, backrunning may be considered a missed opportunity since it’s technically money left on the table.

Thankfully, not everyone has to be an experienced trader to capture the backrunning profits from their trades. Retail traders can automatically benefit from backrunning opportunities through specialized RPC endpoints such as  [MEV Blocker](https://mevblocker.io/).

## How backrunning works

The most common perpetrators of backrunning are MEV bots programmed to monitor pending Ethereum transactions. These bots place strategic trades directly after existing trades in order to capture the arbitrage left over from their price impact.

The process takes advantage of the mechanisms of  [automated market makers (AMMs)](/learn/cow-protocol-glossary#:~:text=amm). Whenever a large trade goes through, it imbalances the liquidity pools of the AMM, causing the price of the asset being sold to go down, and the price of the asset being bought to go up. This price imbalance leaves an arbitrage that MEV bots correct by placing a follow-up trade, earning a profit in the process.

## Backrunning example

To better understand the concept of backrunning, let’s consider an example scenario. In this example, a user named Alex initiates a substantial trade, selling $10,000 of ETH to buy COW on Uniswap. Due to the nature of AMMs, this swap leads to a jump in the value of COW and a drop in the value of ETH on this particular exchange (Uniswap).

At the same time, an MEV bot notices Alex’s large transaction and springs into action. The MEV bot acquires Alex’s sell token (ETH) at this lower price and immediately turns around and sells it for a higher price on a different exchange where this price arbitrage has not yet been reflected. The bot profits from the price difference between the assets on these two exchanges.

From a technical perspective, Alex’s transaction doesn’t result in any realized loss for him, since he still got the price he was quoted for his trade. However, his trade created an arbitrage opportunity that he didn’t capture, leaving money on the table.

The actions of the MEV bot have broader implications for the DeFi ecosystem. Bots monopolize arbitrage opportunities between exchanges and deny regular users the chance to benefit from the price impact their trades create.

## Related MEV tactics

[**Frontrunning**](/learn/what-is-frontrunning)**:** In a frontrunning attack, an MEV bot spots a profitable transaction, duplicates it, and offers a higher gas fee so that validators execute the duplicate transaction before the original one. In effect, the MEV bot hijacks the profits of the original transaction and keeps them for itself.

[**Sandwich Attacks**](/learn/what-is-a-sandwich-attack-and-how-can-you-protect-yourself)**:**  This tactic combines frontrunning and backrunning. An attacker first executes a frontrunning transaction before a valuable trade, pushing the price of the asset up to the slippage tolerance set by the victim trade. This increases the price of the purchased asset. The victim trade then goes through at this new higher price and its price impact raises the price of the asset even more. Finally, the attacker performs a backrunning attack which captures the newly-created arbitrage, generating a profit in the process.

## How harmful is backrunning?

Backrunning is not as harmful as the other types of MEV attacks since it doesn’t result in traders receiving a worse price for their trades. Rather, it simply means that traders leave money on the table by not capturing the arbitrage opportunities from their large trades.

This opportunity cost primarily affects advanced traders who would otherwise be able to capture this arbitrage for themselves. Everyday traders are usually not sophisticated enough to backrun their own trades, so backrunning does not really result in measurably worse outcomes for them.

However,  [MEV Blocker](https://mevblocker.io/)  can help anyone trading on Ethereum automatically capture any backrunning opportunities that their trades create.

## How CoW Swap protects against backrunning

CoW Swap has developed an innovative set of mechanisms for mitigating harm from all types of MEV, including backrunning. The system relies on  [Order Flow Auctions](/learn/understanding-order-flow-auctions)  that gather and consolidate user orders into a batch before execution. Specialized parties known as “[solvers](https://docs.cow.fi/cow-protocol/tutorials/solvers)’’ compete to find the most optimal execution path and provide the best settlement solution.

The design of CoW Swap helps protect against MEV attacks in several ways:

1.  **Delegated trade execution**: When users submit orders on CoW Swap, they are not directly initiating a blockchain transaction, like they would on Uniswap for example. Instead, users submit orders as signed “[intent to trade](/learn/cow-protocol-glossary#:~:text=Intent%20to%20Trade)” messages which include the details of the intended trade, but don’t actually get submitted to the blockchain. The solvers then find the best execution path for the specified trade and execute the trade on-chain on behalf of the user.
2.  **Uniform clearing prices:**  The batch auction system ensures that each asset in the batch only executes for a single price, even if there are multiple trades using that asset. This negates the price variations inherent to AMMs that result in different prices for trades within the same block due to sequential transaction processing. Uniform clearing prices nullify the strategy of transaction re-ordering, thereby mitigating the impact of MEV.
3.  **Liquidity:**  CoW Swap’s unique solver design executes trades optimally without leaving room for arbitrage opportunities. Thanks to Uniform Clearing Prices, all token pairs traded in the same batch will clear at the same price, leaving liquidity pools balanced with no opportunity for arbitrage.

In addition, CoW Swap leverages off-chain interactions known as “[Coincidences of Wants](/learn/what-are-cows-on-cow-swap)” (CoWs) to swap user assets peer-to-peer, leaving zero room for MEV. Furthermore, the protocol’s Order Flow Auction mechanism ensures that user trades are maximally protected from all types of MEV.

Backrunning is prevalent in the DeFi space, leaving everyday traders with suboptimal outcomes at the expense of searchers & MEV bots. However, innovative solutions like CoW Swap are combating the issue of backrunning and MEV as a whole through innovative Order Flow Auction design.

## MEV Blocker — Profit from backrunning

On  [CoW Swap](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=backrunning-article), your orders are protected from all types of MEV, including backrunning, sandwich attacks, and frontrunning.

CoW DAO has taken MEV protection a step further, however, with  [MEV Blocker](https://mevblocker.io/). MEV Blocker is a custom RPC endpoint that you add to your crypto wallet which routes all of your transactions through a trusted network of searchers that scan for backrunning opportunities, but cannot frontrun or sandwich your trades. The best part? The RPC passes the profits from backrunning opportunities back to you in the form of rebates. This means you can make money from any backrunning opportunity you create just by routing your transactions through MEV Blocker.

MEV Blocker works on all types of transactions across all of DeFi. Just  [add the RPC endpoint to your wallet](https://mevblocker.io/#rpc)  and start trading.

While MEV Blocker should be part of every Ethereum user’s arsenal, it’s still optimal to use CoW Swap when doing swaps. CoW Swap is specifically engineered to give traders the best prices and protect against all types of MEV without leaving backrunning opportunities.

Remember: if you’re swapping, use CoW Swap. For everything else, rely on MEV Blocker.

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What is Backrunning? — MEV Attacks Explained


The CoW Swap team is excited to release a simpler trading experience for its users. Gasless approvals allow traders to swap over 150 tokens completely gaslessly through CoW Swap.

Before the launch of gasless approvals, CoW Swap users benefitted from gasless trading thanks to CoW Swap’s  [intent-based](/learn/cow-protocol-glossary#:~:text=Intent%20to%20Trade)  execution model. However, they still needed to pay gas fees (in ETH) to execute approval transactions the first time they wanted to trade any token.

With gasless approvals, CoW Swap now allows users to sign a message (gas free!) that gives  [solvers](https://docs.cow.fi/solvers/solvers)  permission to execute the approval transaction on their behalf. Solvers then bundle the approval transaction with the first swap, and users pay fees in the sell token.

The result? Users can now do an entire swap, even for a new token, without spending a gwei in ETH, or even holding any ETH in their wallet at all. That’s a smoooooother (and cheaper) user experience. Moo-gnificent!

## Benefits of gasless approvals

This new upgrade comes with a host of benefits relevant to EOA and multisig wallets alike.

-   **Fully ETH-less swaps:** New users and fresh wallets can complete swaps end-to-end without needing ETH — that’s especially nice for airdrop farmers and privacy seekers
-   **Faster trades**: CoW Swap users don’t have to wait for an approval transaction to execute before the swap — traders can now swap right away, even with tokens they haven’t traded before
-   **Bundling efficiency**: Approval transactions execute alongside orders, in the same block — shielded from fluctuating gas prices, for a more cost-efficient experience overall
-   **Enhanced security**: Only an approved spender can execute transactions on behalf of a trader — users can trust that CoW Swap is as secure as ever

## Gasless approvals under the hood

Gasless approvals rely on  [ERC-2612: Permit Extension for EIP-20 Signed Approvals](https://eips.ethereum.org/EIPS/eip-2612).

Essentially, a function creates a signature that can call approvals directly on behalf of the owner. This allows a third party, such as a solver, to spend funds on behalf of the user. For security, gasless approvals rely on nonces which indicate the number of times a permit signature has been used. (There is also a time window in which the signature must be used.) This protects users from replay attacks because it is impossible to replicate an approval with the same nonce.

Each Ethereum transaction has a minimum fixed transaction cost associated with it. When executing transactions individually, this cost is usually higher per action than if users bundle multiple transactions together. So, in addition to creating a better user experience for traders, gasless approvals also lower the overall cost of trading on CoW Swap.

## Now live on CoW Swap

Gasless approvals are now live on  [CoW Swap](https://swap.cow.fi/#/1)  for Ethereum Mainnet. See which tokens are currently supported by checking out the  [CoW Swap Permittable Tokens List](https://hackmd.io/@mastercow/cowswap-gasless-approvals).

As always, on CoW Swap:

-   Orders are free to place and cancel
-   Traders never pay for failed transactions
-   Fees that cover settlement costs are paid in traders’ sell tokens
-   Traders are fully protected from MEV

Happy trading!

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Announcing Gasless Approvals on CoW Swap


## TL;DR

-   During the month of September, CoW Protocol handled a total volume of $**772M**, and generated a surplus of  **$4.8M**
-   In exciting news, CoW Protocol ran the  [TWAP-tember trading contest](https://x.com/CoWSwap/status/1697638081082556725?s=20), integrated oSnap for  [better decentralized governance](https://medium.com/@cow-protocol/cow-dao-integrates-osnap-for-decentralized-governance-42b8f6c42660), hosted a booth at  [DappCon](https://twitter.com/CoWSwap/status/1701193378208137377?s=20), and much more

## Protocol Stats

This month, CoW Protocol settled a total of **$772M.**

![1-september-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_september_2023_highlights_a3af17e6e8.webp)

This month, the top 3 batches worth highlighting are the following:

-   **Batch with the highest % of CoW trades**  [(Transaction details)](https://explorer.cow.fi/tx/0x7e1ec020695aa5797d9372f0513970d369fbece8b4ec9b7fea21c06dc7ca8612?tab=orders). The total batch volume was  **$1,571,462.41**, and it was created by two traders who were perfectly CoWed for  **61% ($966,799.56)** of their volume. One trader was buying  **$cbETH**, and the other trader was selling  **WETH**.

![2-september-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_september_2023_highlights_9ae329c916.webp)

-   **Batch containing the highest volume**  [(Transaction details)](https://explorer.cow.fi/tx/0x4aef2109d2c99e6822bff66f3a508858cea5ab14bc932ce306f542aef6b95c63?tab=orders&vis=transfers): The total batch volume was  **$20,834,561.93** and it was created by a single trader who was swapping  **USDC**  to  **DAI**.

![3-september-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_september_2023_highlights_223272ee64.webp)

-   **Batch with the highest amount of surplus**  [(Transaction details)](https://explorer.cow.fi/tx/0x6ef290e2a8d35b7b050319ee182345b6933ed24de690d67ceb64bb2268c535ba?tab=orders): The total batch volume was  **$97,406.4226** and it was created by a single trader who was swapping  **BOND**  **to**  **DAI**. This trader achieved the largest surplus for the month of  **September**, by getting  **$76,201.52 (11% surplus)**  extra in DAI.

![4-september-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_september_2023_highlights_eb51f8d53a.webp)

During the month of  **September**, the top 10 traders traded a total of  **$80M.**

![5-september-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_september_2023_highlights_5b1431f313.webp)

In the table below you can see the total volume for this month’s biggest trades. Our most active trader executed a whopping  **$55M**  in trades with CoW Protocol this month.

![6-september-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_september_2023_highlights_82c11c4600.webp)

## Solvers

In  **September**, solvers generated a total of  **$4.8M**  in surplus, which is money in the pockets of traders.

![7-september-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/7_september_2023_highlights_bee4ae7db8.webp)

Below you can find a breakdown of how each solver performed in September.

![8-september-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/8_september_2023_highlights_3028469d9c.webp)

## Governance

It was a quiet month in terms of governance. The CoWs were just chilling.

![9-september-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/9_september_2023_highlights_8b9340ebd6.webp)

### Draft Proposals

This month, there was one new proposal asking for feedback before moving into the next phase, a final CIP, in its current form:

-   [CIP-Draft: Change CoW DAO’s (cow.eth) Snapshot space settings](https://forum.cow.fi/t/cip-draft-change-cow-daos-cow-eth-snapshot-space-settings/1897/1)

### Technical Discussions

As an “agora” for technical topics on batch auctions or CoW Protocol-related topics, the forum surfaced some very interesting posts:

-   [Guidelines for solver-computed fees for long-standing limit orders as implied by past CIPs](https://forum.cow.fi/t/guidelines-for-solver-computed-fees-for-long-standing-limit-orders-as-implied-by-past-cips/1921/1)
-   [Implementing Liquidations using CoW Protocol](https://forum.cow.fi/t/implementing-liquidations-using-cow-protocol/1922/1)

Make sure to read them and leave comments — your feedback is highly appreciated and will help move these important topics forward. If you are interested in submitting a proposal to the CoW DAO, make sure to use the following  [template](https://forum.cow.fi/t/cip-0-template/28).

## CoWmunity News

-   September was  [TWAP-tember for the CoW Swap herd](https://x.com/CoWSwap/status/1697638081082556725?s=20)! The grand prize was free trading on CoW Swap for the entire month of October, and we’ve announced the winners  [here](https://x.com/CoWSwap/status/1709221631338725599?s=20)
-   CoW DAO integrated oSnap for more decentralized protocol governance. Read how oSnap directly executes Snapshot proposals on-chain  [here](https://medium.com/@cow-protocol/cow-dao-integrates-osnap-for-decentralized-governance-42b8f6c42660)
-   The CoW team traveled to Berlin to  [attend DappCon](https://twitter.com/CoWSwap/status/1701193378208137377?s=20)! The team hosted a booth and delivered talks on Composable CoW, MEV, and how to deploy a solver
-   Dune published a  [case study](https://dune.com/case-studies/cow-protocols-journey-into-automated-payments-and-understanding-user-behavior)  on how CoW Swap uses the analytics tool to monitor exchange volume and the DeFi ecosystem as a whole
-   Uniswap  [integrated MEV Blocker](https://x.com/CoWSwap/status/1705272393651061037?s=20)  into Uniswap Wallet
-   We hosted a Twitter space titled “[How to execute large treasury swaps via Coinshift’s native CoW Swap app](https://twitter.com/CoWSwap/status/1706702796345467316?s=20)”
-   The DODO research team  [published an article](https://x.com/CoWSwap/status/1707719113554997668?s=20)  on the benefits of CoW Swap compared to other DEX aggregators
-   The CoW team published several articles on our blog,  [CoW Protocol Glossary](https://medium.com/@cow-protocol/cow-protocol-glossary-ad7313a2c71),  [CoW DAO integrates oSnap for decentralized governance](https://blog.cow.fi/cow-dao-integrates-osnap-for-decentralized-governance-42b8f6c42660)  and  [Why TWAP?](https://blog.cow.fi/why-twap-25d9a0f690f4)

## Product Updates

**Backend**

The backend team has been working hard to improve the product infrastructure. In  **September**, we:

-   Implemented a change so that external solvers now provide revert risk of their solutions instead of a complex composite score
-   Made price estimation logic more streamlined
-   Spent time deploying solver driver colocation on Gnosis chain staging
-   Added some open-source contributions to the Enso simulator for features we could use
-   Added support for score computation logic for the colocated driver

**Frontend**

The frontend team has been pushing hard for several improvements in the UI front as well as the overall UI infrastructure. In  **September**, we:

-   Added a “new” badge for TWAP to the swap widget on our website
-   Added more unit tests for SDK
-   Set up CMS for cow.fi based on Strapi
-   Made significant UI progress on the CoW Swap widget
-   WatchTower: Arrived at zero errors, polished the indexers, fixed some errors, improved logs, handled race condition

## Open Job Positions

CoW Protocol team is currently looking to hire:

### Engineering

[Backend Engineer with Rust Remote or Lisbon](https://boards.eu.greenhouse.io/cowswap/jobs/4208538101)

### Operations

[Operations Manager Remote or Lisbon](https://boards.eu.greenhouse.io/cowswap/jobs/4219633101)

For more information on our latest job openings, visit:  [https://cow.fi/jobs](https://cow.fi/jobs)


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Welcome back to another CoW Update, where we break down the most notable developments of the last few weeks at CoW Protocol.

CoW Protocol September 2023 Highlights

CoW Swap has recently become one of the first DeFi projects to launch native support for Time-Weighted Average Price (TWAP) orders. TWAP orders spread out large trades into multiple smaller orders. This reduces slippage & price impact and helps traders enter or exit a market position at an average price.

TWAP has been around for a while on centralized exchanges, but CoW TWAP — CoW Swap’s version of TWAP — comes with several important benefits that traders won’t find on CEX alternatives.

## Benefits of TWAP orders

### Dollar-Cost Averaging (DCA)

TWAP orders help automate the dollar-cost averaging (DCA) investment strategy. DCA involves investing a fixed amount of money in an asset at regular intervals, regardless of the asset’s price, in order to reduce the impact of market volatility.

In highly volatile markets like crypto, the risk of making a large investment just before a sudden price shift is significant. TWAP minimizes this risk by breaking down your investment into smaller, evenly distributed purchases over time. This finds an average market price and helps smooth out market volatility. Want to buy an asset but you’re not sure exactly when to click the “Swap” button? TWAP-enabled DCA means you can forget about timing the market and get the average price instead.

Investors can also use TWAP to sell their positions through dollar-cost averaging. Simply switch the assets you’re swapping and TWAP will help you exit the market for an average price.

Riding the crypto waves has never been so s-moooo-th! 🐮

### Reduce your price impact

Large orders move markets and traders often get worse prices as a result. By splitting up large trades into multiple smaller orders, TWAP helps mitigate the negative effects of price impact. A bunch of smaller orders affect prices much less than one big order, meaning you end up getting a better deal for your trades.

### Reduce your slippage

Finding the right slippage can be tricky. Set it too low and your order might not go through, too high and you could fall prey to MEV. Using TWAP to split up a large order into smaller parts allows you to use a smaller slippage tolerance for each part. The MEV bots can stay hungry…

## Why TWAP with CoW Swap?

Those familiar with CoW Swap know there’s always something extra in our barn 😉. Below are some exclusive benefits you’ll only find on CoW TWAP.

### Always receive 100% of your order surplus

CoW Swap searches for surplus opportunities on every order and TWAP orders are no exception. In fact, since TWAP orders are split up into different parts, each part is another opportunity to find surplus for your trade.

In our tests, selling 1,000 ETH in four parts of 250 ETH each allowed us to get a price for the order that was 3.5% better than selling the 1,000 ETH all at once! This was in large part thanks to CoW Swap’s batch auctions that include finding  [Coincidence of Wants](/learn/what-are-cows-on-cow-swap) and other price improvements.

### Get price protection
![1-why-twap.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_why_twap_bd8b2c362b.webp)

After you select the assets you want to trade through CoW Swap’s TWAP interface, you’ll need to indicate the number of order parts you want to use, as well as the total duration over which you’d like your TWAP order to execute. From these selections, the interface automatically calculates each part duration and the amounts you will be buying and selling per part.

Unique to TWAPs on CoW Swap is the “price protection” feature. Price protection ensures that your order will stop executing if the market price of the assets moves by more than your specified percentage.

## Get started with CoW TWAP

To get started with TWAP orders on CoW Swap, you’ll first need to ensure that you have a Safe wallet. Currently, TWAP is only available through Safe but support for more wallets will be coming soon.

Don’t have a Safe? No problem! Create one  [here](https://app.safe.global/share/safe-app?appUrl=https%3A%2F%2Fswap.cow.fi&chain=eth). After you make a Safe, you’ll also need to upgrade your fallback handler. Learn what this means and how to do it  [here](/learn/all-you-need-to-know-about-cow-swap-new-safe-fallback-handler).

Once your Safe is fully set up, you can access TWAP directly through the  [CoW Swap order interface](https://swap.cow.fi/#/1/advanced?utm_source=medium&utm_campaign=why-twap).

TWAP orders on Ethereum Mainnet have a $5,000 minimum per order part. This ensures that gas costs are relatively low compared to the entire order size, even with multiple parts involved. Smaller traders can also enjoy CoW TWAP on Gnosis Chain where part minimums are only $5 (and the gas is much cheaper!)

You can find the full how-to guide on CoW TWAP orders  [here](/learn/how-to-use-cow-swap-twap-orders-via-safe-wallet).

As always, on CoW Swap:

-   All prices are aggregated from the best available on-chain and off-chain liquidity
-   Traders are fully protected from MEV
-   Orders are free to place and free to cancel
-   Traders never pay for failed transactions
-   Transactions are gasless as fees are paid in the sell token

Happy TWAPping!
![2-why-twap.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_why_twap_6f088c5738.webp)

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How CoW Swap’s new feature, Time-Weighted Average Price (TWAP) orders helps you get better prices for your trades


Why TWAP?

CoW DAO is an open organization of developers, traders, market makers, and various community members aligned with the vision of providing traders with the best prices and comprehensive MEV protection. CoW DAO is focused on building and maintaining CoW Protocol, a fair and decentralized trading system, and MEV Blocker, an RPC endpoint. CoW Protocol’s technology powers a network of traders and solvers, enabling trustless and efficient peer-to-peer trading through a unique “batch auction” system. This positions CoW Protocol as native trading infrastructure for discrete-time settlement layers like Ethereum. MEV Blocker is designed to protect transactions from MEV attacks such as front-running and sandwiching. In addition to protecting trades from harmful MEV, MEV Blocker leverages an Order Flow Auction between various searchers and builders to offer rebates to users for certain trades.

[oSnap](https://uma.xyz/osnap)  is a DAO governance tool built and secured by  [UMA](https://uma.xyz/). It allows communities to vote off-chain and automatically execute the successful proposals on-chain. oSnap automatically integrates with the DAO’s  [Snapshot](https://snapshot.org/#/)  space and the Safe wallet holding the DAO’s treasury funds. Transactions approved by the community are validated on-chain and executed without the need for centralized multisig approval.

CoW DAO is looking forward to integrating oSnap, as it will give the DAO several advantages including:

-   A decentralized process to execute successful proposals that no longer requires the involvement of multisig signers → Instead of having the multisig owners push successful proposals on-chain themselves, the oSnap bot will automatically execute them
-   Extra on-chain guarantees through a challenge period → Through oSnap, voters will be able to challenge proposals during a “challenge period” that takes place after the successful passing of a proposal
-   One step closer to a more decentralized and resilient CoW DAO → Integrating oSnap allows CoW DAO to run 100% through on-chain governance without relying on any off-chain infrastructure or trusted parties

## How it works

On a technical level, Snapshot allows users to integrate transaction data into their proposals using its transaction builder tool. Community members can include specific transactions in their proposals for the DAO to execute. Once a proposal is published, Snapshot uses the decentralized hosting service IPFS to store and share this transaction data, assigning it a unique identifier in the process.

Once a proposal is approved, the oSnap system takes charge of submitting the transaction data to UMA’s optimistic oracle. The oracle then verifies that the transaction matches the data stored at the IPFS identifier. If the oracle confirms the match, the transaction is executed using funds from the DAO Safe. However, in the event of an invalid or malicious transaction, the system automatically removes the data before it reaches the blockchain.

This integration is a step forward for CoW DAO’s decentralization. If you are interested in participating in the CoW DAO governance process, you have several options:

-   [Forum](https://forum.cow.fi/)  → CoW DAO’s forum is the main venue for governance-related discussion. Signing up for the forum allows community members to post and participate in discussions.
-   [Snapshot](https://snapshot.org/#/cow.eth)  → CoW DAO’s Snapshot space is a simple voting interface that allows users to vote on proposals. Votes on Snapshot are weighted by the number of vCOW+COW held or delegated to the address used to vote.
-   [Discord](https://discord.gg/cowprotocol)  → The CoW DAO Discord server is currently the main discussion hub for the CoW community and an informal place for governance discussions. The “governance-discussion” channel is where governance matters and proposals are discussed.

## Learn more

[CoW DAO](https://cow.fi/)  is a decentralized organization maintaining CoW Protocol and  [MEV Blocker](https://mevblocker.io/)  for the effective protection of Ethereum traders across DeFi. CoW Protocol leverages batch auctions to find the best prices for user trades, while MEV Blocker maintains a decentralized network of searchers & builders who protect users from MEV and provide them with rebates from profitable backrunning opportunities.

[oSnap](https://uma.xyz/osnap)  is a governance tool secured by UMA and audited by Open Zeppelin. It is free to use and can be integrated in less than 60 seconds.

[UMA](https://uma.xyz/)  is an optimistic oracle that can validate any independently verifiable data on the blockchain. UMA ensures protocol security by incentivizing validators to identify and delete false information passing through the oracle. Since launching in 2020, UMA has secured more than 10,000 critical data assertions. It has never been corrupted.

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CoW DAO has integrated oSnap as a means of directly executing the results of future Snapshot votes on-chain. This integration eliminates the need for multi-signature wallets, creating a more decentralized and efficient execution process.

CoW DAO integrates oSnap for decentralized governance

## TL;DR

-   During the month of  **August**, CoW Protocol handled a total volume of  **$1.05B**, and generated a surplus of  **$5.3M**
-   In exciting news, CoW Protocol  [launched TWAP orders](https://blog.cow.fi/cow-swap-launches-twap-orders-d5583135b472), added  [native support for Trezor wallets](https://twitter.com/CoWSwap/status/1696902398164316377?s=20), and was  [featured on the 0xResearch podcast](https://twitter.com/0xResearch/status/1695065029563838767?s=20)
-   In terms of Governance, CoW DAO executed CIPS  [28](https://snapshot.org/#/cow.eth/proposal/0x269163793f84ceded1b4c902ca1d368e49f4c5991cb4780493feca2a0b640f1b),  [29](https://snapshot.org/#/cow.eth/proposal/0x22fde20fee09167dbde2981a8e9b7552dcb67af887474b0005d15eedb2a8a6d9), and  [30](https://snapshot.org/#/cow.eth/proposal/0xbb52a603325a81e2f4e2cb0bb17d6626d8929737f2511d18e184cdeb94f7f3de)

## Protocol Stats

This month, CoW Protocol settled a total of  **$1.05B.**

![1-august-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_august_2023_highlights_164dca9836.webp)

This month, the top 3 batches worth highlighting are the following:

-   **Batch with the highest % of CoW trades (**[**Transaction details**](https://explorer.cow.fi/tx/0x549099b6116bbe176ae524b33ac56c92b768b92ab76fd88de351c94d25870f64?tab=graph)**)**. The total batch volume was  **$41,401,** and it was created by two traders who were CoWed for  **40%**  **($16,401)**  of the batch volume. One trader was buying  **stETH**  with  **DAI**, and the other trader was selling  **DAI**  for  **stETH.**


![2-august-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_august_2023_highlights_f74091792f.webp)

-   **Batch containing the highest volume (**[**Transaction details**](https://explorer.cow.fi/tx/0x094f33db1244c18dd34a026e36bcf42653eaf51ce4731ea4b3cee663daa081dc?tab=graph&vis=transfers)**):**  The total batch volume was  **$9,988,935.71** and it was created by a single trader who was swapping  **USDT to**  **USDC**.


![3-august-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_august_2023_highlights_c84ee58c09.webp)

-   **Batch with the highest amount of surplus (**[**Transaction details**](https://explorer.cow.fi/tx/0x55c195cbc41c7547d7e30e02a89d626abeddcaa0d6e6d4e5f48934c5414e0da0?tab=orders&vis=transfers)**)**: The total batch volume was  **3,545.97 ETH** and it was created by two traders who were swapping  **ETH**  to  **stETH** and  **ETH**  to  **DAI**. Combined, these two traders achieved the largest surplus for the month of  **August**, by getting  **$127,719.33K**  (**2.01%**  surplus) extra.


![4-august-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_august_2023_highlights_b536caa80f.webp)

During the month of  **August**, the top 10 traders traded a total of  **$109M.**


![5-august-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_august_2023_highlights_08c9d1d339.webp)

In the table below you can see the trade volume that CoW Swap traders have executed as well as the total volume for all trades. Our most active trader executed a whopping  **$100M** in trades with CoW Protocol this month.


![6-august-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_august_2023_highlights_46765e7ebb.webp)

## Solvers

In  **August**, solvers generated a total of  **$5.2M**, which is money in the pockets of traders.


![7-august-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/7_august_2023_highlights_7de2003217.webp)

Below you can find a breakdown of how each solver performed in August.


![8-august-2023-highlights.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/8_august_2023_highlights_62263bcf59.webp)

## Governance

It has been a hectic month in terms of governance; CoW DAO has executed 3 proposals! After a relaxing month of July, the CoWs came back in force for August 💪.

### Executed Proposals

This month we executed three important proposals:

-   [CIP 28 — Should CoW DAO send its profits to the CoW Treasury Core unit to generate extra revenues?](https://snapshot.org/#/cow.eth/proposal/0x269163793f84ceded1b4c902ca1d368e49f4c5991cb4780493feca2a0b640f1b)
-   [CIP-29: Renewal of the solver rewards program](https://snapshot.org/#/cow.eth/proposal/0x22fde20fee09167dbde2981a8e9b7552dcb67af887474b0005d15eedb2a8a6d9)
-   [CIP-30: Implementing oSnap for Optimistic Governance in CoW DAO](https://snapshot.org/#/cow.eth/proposal/0xbb52a603325a81e2f4e2cb0bb17d6626d8929737f2511d18e184cdeb94f7f3de)

### Draft Proposals

There has been a new proposal asking for feedback before moving into the next phase, a final CIP, in its current form:

-   [Fees and CoW bonding for MEVBlocker](https://forum.cow.fi/t/fees-and-cow-bonding-for-mevblocker/1876)

### Technical Discussions

As an “agora” for technical topics on batch auctions or CoW Protocol-related topics, the forum surfaced an interesting post:

1.  [Measuring and banning overbidding](https://forum.cow.fi/t/measuring-and-banning-overbidding/1874)

Make sure to read through it and leave comments — your feedback is highly appreciated and will help move important topics forward. If you are interested in submitting a proposal to the CoW DAO, make sure to use the following  [template](https://forum.cow.fi/t/cip-0-template/28).

## CoWmunity News

-   In August we  [launched the much anticipated TWAP (Time-Weighted Average Price) special order type](https://blog.cow.fi/cow-swap-launches-twap-orders-d5583135b472)  on Ethereum Mainnet and Gnosis Chain
-   Added  [native support for Trezor](https://twitter.com/CoWSwap/status/1696902398164316377?s=20)  — Trezor users can now interact with CoW Swap natively without having to connect via a third party wallet
-   CoW Swap’s co-founder and CTO, Felix, was a guest on the  [0xResearch podcast](https://twitter.com/0xResearch/status/1695065029563838767?s=20)  where he discussed strategies for eliminating MEV
-   Participated in a  [Twitter space on “Intent-ifying the future”](https://twitter.com/CoWSwap/status/1689268085574758400?s=20)  with Across Protocol
-   MEV Blocker was featured in the  [Our Network newsletter](https://ournetwork.substack.com/p/ournetwork-issue-178)  as a solution to the problem of MEV
-   CoW DAO’s treasury manager, Karpatkey, built out a  [slick dashboard](https://twitter.com/CoWSwap/status/1689649381925163008?s=20)  showcasing the treasury operations of CoW DAO
-   Keystone wallet partnered with CoW Swap to give customers  [15% off its new CoW-branded Keystone 3 Pro](https://twitter.com/CoWSwap/status/1691554495296160073?s=20)
-   [Coinshift integrated CoW Swap](https://twitter.com/0xCoinshift/status/1694029063042871365?s=20)  to bring CoW’s multi-sig swap functionality to Coinshift apps
-   A grant proposal for a Software Engineer Core Contributor was  [posted to the forum](https://forum.cow.fi/t/core-contributor-software-engineer-aug-2023-jan-2024-inclusive/1870)  and  [passed in voting on Snapshot](https://snapshot.org/#/cowgrants.eth/proposal/0x0202a88c6792d1bd1e534cf1da94769130f495e72247e666b4afff8b22da9db0)
-   A grant proposal for a Copywriter Core Contributor was  [posted to the forum](https://forum.cow.fi/t/core-contributor-copywriter-september-2023-february-2024/1873/2)  and  [passed in voting on Snapshot](https://snapshot.org/#/cowgrants.eth/proposal/0xd1efd4784310bbbdb8ea1d566202d11e8dda26eb73711307076433a25a475f97)
-   Published several articles on our blog:  [What is price improvement and why is it unique to CoW Swap?](https://blog.cow.fi/what-is-price-improvement-and-why-is-it-unique-to-cow-swap-e21d86e756be),  [Aave Trade Breakdown](https://blog.cow.fi/aave-trade-breakdown-e17a7563d7ba),  [ENS Trade Breakdown](https://blog.cow.fi/ens-trade-breakdown-a8eb00ddd8c0),  [Nexus Mutual Trade Breakdown](https://blog.cow.fi/nexus-mutual-trade-breakdown-4aacc6a94be8),  [CoW Swap Launches TWAP Orders](https://blog.cow.fi/cow-swap-launches-twap-orders-d5583135b472),  [How to use CoW Swap’s TWAP orders via Safe Wallet](https://blog.cow.fi/how-to-use-cow-swaps-twap-orders-via-safe-wallet-1a0854484dfb), and  [All you need to know about CoW Swap’s new Safe fallback handler](https://blog.cow.fi/all-you-need-to-know-about-cow-swaps-new-safe-fallback-handler-8ef0439925d1)

## Product Updates

**Backend**

The backend team has been working hard to improve the product infrastructure. In  **August**, we:

-   Worked on storing more required data in colocated mode
-   Implemented a new strategy for fetching the current block to reduce system lag by 1 block
-   Made a strong push towards verified quotes and CIP-27
-   Implemented a change so that solvers are no longer allowed to give strange values from the score (specifically overbidding), the driver will now always calculate the score
-   Improved driver colocation by deploying Goerli as expected and refactoring how we setup legacy estimators in the infrastructure
-   Launched TWAP
-   Implemented a metrics fix for determining which solver provides the “winning” quote
-   Removed a bunch of code related to surplus fee computation

**Frontend**

The frontend team has been pushing hard for several improvements in the UI front as well as the overall UI infrastructure. In  **August**, we:

-   Released CowSwap 1.44.0
-   Worked on integration of hardware wallets (Trezor, Ledger)
-   Added support for permitable tokens (EIP-2612)
-   Made lots of progress on TWAP and released the feature
-   Added support for WalletConnect v2
-   Did lots of work on the WatchTower — an important piece of infrastructure for TWAP and Composable orders
-   Exposed the interface to composable orders via cow-sdk

## Open Job Positions

The CoW Protocol team is currently looking to hire:

### Engineering

[Backend Engineer with RustRemote or Lisbon](https://boards.eu.greenhouse.io/cowswap/jobs/4208538101)

For more information on our latest job openings, visit:  [https://cow.fi/careers](https://cow.fi/careers)



CoW Protocol August 2023 Highlights

## TL;DR

-   During the month of  **July**, CoW Protocol handled a total volume of  **$865M**, and generated a surplus of  **$4.8M**
-   In exciting news, CoW Protocol  [launched CoW Hooks](https://thedefiant.io/cowswap-enables-complex-swaps-with-hooks), completed a big  [overhaul of surplus notifications](https://blog.cow.fi/announcing-cow-swap-surplus-notifications-f679c77702ea), processed a  [$27.3 million swap for Nexus Mutual](https://www.theblock.co/post/240750/nexus-mutual-diversifies-27-3-million-into-rocket-eth-using-cow-swap?utm_source=twitter&utm_medium=social), and much more

## Protocol Stats

This month, CoW Protocol settled a total of  **$865M.**
![1-july-2023-highlight.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_july_2023_highlight_47dd26561a.webp)

This month, the top 3 batches worth highlighting are the following:

-   **Batch with the highest % of CoW trades (**[**Transaction details**](https://explorer.cow.fi/tx/0xf5fcc8147ebc22122407d514770e2473c2536ff5768780e560076cfe8b020feb?tab=orders&vis=trades)**).** The total batch volume was  **$514,649.23**, and it was created by two traders who were CoWed for  **10% ($49,916)** of the batch volume. One trader was selling  **GHO** with **USDC**, and the other trader was selling  **USDC**  with  **GHO**.
![2-july-2023-highlight.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_july_2023_highlight_11e4b6d7ec.webp)

-   **Batch containing the highest volume (**[**Transaction details**](https://explorer.cow.fi/tx/0x1371ea08e02d465f3225a98f6c73b90473b49493adb6791e5443112173adc974?tab=graph)**)**: The total batch volume was  **$26,737,269.23** and it was created by a single trader who was swapping  **ETH**  **to**  **rETH**.
![3-july-2023-highlight.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_july_2023_highlight_51e10b7ef8.webp)

-   **Batch with the highest amount of surplus (**[**Transaction details**](https://explorer.cow.fi/tx/0xc54930ec6a9b45490e069bbf1a6159f056ea35b64f0c8fbfa4766ef869f5cf37?tab=graph)**):**  The total batch volume was  **2,300 ETH** and it was created by a single trader who was swapping  **ETH**  **to**  **stETH**. This trader achieved the largest surplus for the month of  **July**  by getting  **46 stETH**  extra, which at the time of trade was roughly  **$87,139.36K**  (**2.04%**  surplus).
![4-july-2023-highlight.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_july_2023_highlight_7887ec7eb7.webp)

During the month of  **July**, the top 10 traders traded a total of  **$27M.**
![5-july-2023-highlight.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_july_2023_highlight_40c0cc45e5.webp)

In the table below you can see the trade volume that CoW Swap traders have executed as well as the total volume for all trades. Our most active trader executed a whopping  **$7.5M** in trades with CoW Protocol this month.
![6-july-2023-highlight.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_july_2023_highlight_d1c9054351.webp)

## Solvers

In  **July**, solvers generated a total of  **$4.8M**, which is money in the pockets of traders.
![7-july-2023-highlight.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/7_july_2023_highlight_5efbb058a2.webp)

Below you can find a breakdown of how each solver performed in July.

![8-july-2023-highlight.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/8_july_2023_highlight_544663fea9.webp)

## Governance

It has been a quiet month in terms of executed proposals, the CoWs were relaxing!
![9-july-2023-highlight.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/9_july_2023_highlight_a85b28a529.webp)

### Draft Proposals

This month, there were two new proposals asking for feedback before moving into the next phase, final CIPs, in their current form:

-   [Adjust Solver Rewards to Allow for a Higher Cap](https://forum.cow.fi/t/adjust-solver-rewards-to-allow-for-higher-cap/1842/1)
-   [CIP-28: Should CoW DAO send its profits to the CoW Treasury Core unit to generate extra revenues?](https://forum.cow.fi/t/cip-28-should-cow-dao-send-its-profits-to-the-cow-treasury-core-unit-to-generate-extra-revenues/1805)

### Technical Discussions

As an “agora” for technical topics on batch auctions or CoW Protocol-related topics, the forum surfaced some very interesting posts:

1.  [Merge Settlement Contract and Uni v4](https://forum.cow.fi/t/merge-settlement-contract-and-uni-v4/1769)
2.  [Automated Treasury Management Methodology](https://forum.cow.fi/t/automated-treasury-management-methodology/1799)
3.  [Fast Liquidity in CoW](https://forum.cow.fi/t/fast-liquidity-in-cow/1841)

Make sure to read them and leave comments — your feedback is highly appreciated and will help move these important topics forward. If you are interested in submitting a proposal to the CoW DAO, make sure to use the following  [template](https://forum.cow.fi/t/cip-0-template/28).

## CoWmunity News

-   Launched  [CoW Hooks](https://thedefiant.io/cowswap-enables-complex-swaps-with-hooks), allowing users to execute multiple DeFi actions like swapping, bridging, staking, depositing, borrowing, & more through a single intent
-   Released a CoW Swap widget that allows any dApp to inject the CoW Swap UI directly into their website
-   Upgraded surplus notifications on  [the swap page](https://swap.cow.fi/)  to show users how much surplus they have received after every trade, as well as their overall surplus through the wallet overview page
-   Nexus Mutual used CoW Swap to  [diversify $27.3 million into Rocket Pool ETH](https://www.theblock.co/post/240750/nexus-mutual-diversifies-27-3-million-into-rocket-eth-using-cow-swap?utm_source=twitter&utm_medium=social)
-   Aave DAO swapped aBAL & aWETH into an 80/20 Balancer pool  [in a trade worth close to $2 million](https://twitter.com/CoWSwap/status/1678498134195044361?s=20)
-   Andre Canidio from the the CoW Research Team  [published a paper](https://twitter.com/CoWSwap/status/1679883540740325376?s=20)  exploring a novel method for making batch AMMs more efficient
-   The CoW Swap team  [headed to Paris](https://twitter.com/CoWSwap/status/1680848132173713408?s=20)  to take on ETH CC where CoW Swap  [hosted an MEV day](https://twitter.com/CoWSwap/status/1671216421660147712?s=20)  and  [participated in a “Desiging a DEX” panel](https://www.youtube.com/watch?v=6K-QX6HtoiM)
-   MEV Blocker  [surpassed 4 million transactions](https://twitter.com/CoWSwap/status/1684602457056563200?s=20), protecting over $11 billion of trading volume
-   A grant proposal for “Improvement and Enhancement of the CoW Swap Explorer” was  [approved through Snapshot](https://snapshot.org/#/cowgrants.eth/proposal/0xa9bedf14d3b6fc01c5944390c9ef2a153e0cecc56f4354e198a2ba873900fb18)
-   A grant application for v2 of the Milkman contract  [was posted to the forum](https://forum.cow.fi/t/grant-application-milkman-2-0/1840?u=middleway.eth)
-   Published several articles on our blog:  [CoW Hooks: You are in control](https://blog.cow.fi/cow-hooks-you-are-in-control-480ccb40044a),  [Announcing CoW Swap Surplus Notifications](https://blog.cow.fi/announcing-cow-swap-surplus-notifications-f679c77702ea)  and  [What is Frontrunning?](https://blog.cow.fi/what-is-frontrunning-b2641ad7af21)

## Product Updates

**Backend**

The backend team has been working hard to improve the product infrastructure. In  **July**, we:

-   Deployed arak to start indexing liquidity-related events
-   Identified and proposed fixes for CIP-20 support in co-located driver
-   Recorded order events into a database for accurate measurements for our SLAs
-   Stored solver addresses with the winning quotes for CIP-27
-   Ran more price estimators
-   Made minor driver bug fixes and consistency changes

**Frontend**

The frontend team has been pushing hard for several improvements in the UI front as well as the overall UI infrastructure. In  **July**, we:

-   Deployed a hotfix with WalletConnect v2 support
-   Worked on displaying all parts and filled % for the TWAP UI
-   Added default UTMs for links (to credit volume to people that found CoW Swap using cow.fi)
-   Made bug fixes and put final touches on TWAP
-   Made AppData changes to the frontend stack (app-data, SDK, Explorer, CoW Swap)
-   Implemented a Google analytics update for the Grants website

## Open Job Positions

The CoW Protocol team is currently looking to hire:

### Engineering

[Backend Engineer with RustRemote or Lisbon](https://boards.eu.greenhouse.io/cowswap/jobs/4208538101)

For more information on our latest job openings, visit:  [https://cow.fi/careers](https://cow.fi/careers)


CoW Protocol July 2023 Highlights

**Intent to Trade:** When users submit orders on CoW Swap, they are not actually initiating a blockchain transaction, like they would on Uniswap. Instead, orders are submitted as signed “intent to trade” messages which include the details of the intended trade, but are not actually submitted to the blockchain. From here, independent parties known as “[solvers](https://docs.cow.fi/cow-protocol/tutorials/solvers)” find the best execution path for the specified trade and execute the trade on-chain on behalf of the user. If a trade route cannot be found for any reason, the transaction will not execute and the user will not be charged a fee for the failed transaction.

**Delegated trade execution**: When it’s time to actually execute a settlement (which can contain multiple trades),  [solvers](https://docs.cow.fi/solvers/solvers)  lock in the execution path and submit the transaction to the blockchain. Note here that it is the solvers who are completing the transaction on behalf of the user, meaning that they determine the correct slippage tolerance to use, the right amount of gas fees, as well as taking on the risk of negative price movements or MEV.

The delegated trading model also means that traders using CoW Swap do not have to spend ETH to cover gas. Instead, gas fees come out of the sell token when making trades.

**AMM**: Automated Market Makers, also known as “DEXs,” are trading mechanisms that allow traders to buy and sell assets in real-time. Unlike traditional “orderbook” trading, which relies on counterparties for every transaction (you need a seller in order to buy and a buyer in order to sell), AMMs work by maintaining a constant ratio between the prices of two assets. For example, ETH and COW. AMMs use the formula “x*y = k” to determine a fair price based on the ratio between two assets (x and y) in the liquidity pool.

Any time a trade alters this ratio by depleting the supply of one asset and increasing the other, the prices of the assets adjust in order to preserve the established ratio. For instance, if a trader buys COW and sells ETH, the COW price rises and the ETH price falls. The opposite happens when traders sell COW and buy ETH.

**Slippage Tolerance**: When placing a trade, traders set a “slippage tolerance” for their transactions which represents the maximum price difference they’re willing to accept for their trade. For example, if ETH is trading at $2,000 and you place an order to buy ETH with a 5% slippage tolerance, you’re willing to buy ETH at up to $2,100. If ETH goes above $2,100, however, your trade will fail as it’s outside your slippage tolerance.

Some amount of slippage tolerance is always necessary because the prices of crypto assets are constantly fluctuating. By the time your trade executes, the price may have moved. Setting your slippage tolerance too high, however, leaves room for searchers to sandwich your trades.

**Price Impact**: Crypto markets, like all markets, are based on supply and demand. AMMs maintain “liquidity pools” of assets which they use to fill trades. Each trade drains some amount of this liquidity and moves the asset's price. This price movement is known as “price impact.”

The larger the trade, the bigger the price impact. A trade of $100 ETH will not move the price of ETH very noticeably, since it only makes up a tiny fraction of the available liquidity. A trade of $1,000,000 ETH, however, will noticeably move the price of ETH.

**Transaction Reordering**: Blockchain transactions do not always enter the block in the order that they were submitted. Searchers can “bribe” the validators responsible for creating the block to get them to arrange transactions in a specific sequence. This transaction reordering is what makes all of MEV possible.

**EOA Wallets:**  Externally owned accounts (EOAs) are Ethereum accounts controlled by private keys. EOA wallets — for example: MetaMask, Rainbow, and Rabby Wallet — allow users to (1) send, hold, and receive Ethereum-native tokens, and (2) interact with smart contracts. Unlike smart contract wallets, EOA wallets are usually generated with a seed phrase and do not have any code associated with them.

**Milkman**: The  [Milkman](https://github.com/charlesndalton/milkman)  smart contract ensures trades are executed for the real-time price or better by utilizing a price checker, such as a Uniswap pool or an oracle. Instead of setting a fixed slippage tolerance based on the current market price, DAOs can utilize Milkman to determine a maximum percentage deviation from a real-time price sourced from a price checker, guaranteeing that their trade will finalize at a fair market price. If a trade can’t be executed within the defined price or better, the order remains pending until the price condition is met, or until the trader cancels the order.

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A list of terms & definitions related to CoW Protocol


CoW Protocol Glossary

To celebrate the  [recent launch of TWAP orders](https://blog.cow.fi/cow-swap-launches-twap-orders-d5583135b472), the CoW team is running a trading raffle with several prizes up for grabs. To enter,  **all you have to do is make at least one TWAP trade during the month of September (TWAP-tember)**!

At the end of the month, the CoW team will select one Safe address to receive the grand prize:

> **_🏆 FREE CoW Swap orders for the month of October (aka, Up-tober_**_📈_**_)*_**

That’s right, Swap for free all month long… how’s that for greener pastures?

But we’re not done milking the fun, while only one lucky winner will receive the grand prize, there’s still more up for grabs:

-   **⌚5 people**  will receive CoW Swap-branded watches, to help time your trades
-   **💳 10 people**  will receive custom CoW Swap-branded  [Gnosis Pay](https://gnosispay.com/)  cards

Keep in mind, Ethereum mainnet TWAPs start at a minimum of $5k per part, but you can  [TWAP on Gnosis Chain](https://swap.cow.fi/#/100/advanced/WETH?utm_campaign=twap-tember-medium)  with only $5 per part! **In fact, TWAPs on Gnosis Chain have lower fees (thanks to lower gas costs) and lower $$ minimums than mainnet** (which should also come in handy for Safe deployment).

So what are you waiting for anon? Grab your  [Safe](https://safe.global/)  wallet and head over to  [CoW Swap](https://swap.cow.fi/#/1/advanced/WETH?utm_campaign=twap-tember-medium)  to get your TWAP on. If you’re new to TWAP, we’ve created a handy  [how-to guide](/learn/how-to-use-cow-swap-twap-orders-via-safe-wallet)  to help you with your first trade.

## 🐮 Let TWAP-tember begin! 🐮

Visit  [CoW Swap today to TWAP](https://swap.cow.fi/#/1/advanced/WETH?utm_campaign=twap-tember-medium)  your way to the top.

The winning addresses will be announced on the  [CoW Swap Twitter](https://twitter.com/CoWSwap)  so keep an eye on it for instructions on how the winners can claim their physical prizes!

_Terms & Conditions: To receive waived fees, orders must take place between the 1st and 31st of October, 2023. A maximum of $5000 in fees will be refunded._

**———————————————————————**

**UPDATE:**  The winners of TWAP-tember have been announced!

**Grand Prize Winner:** 0x4cb5eE1ad8Bf1B9d75422f9aD086Da2F84BD91B4

**Winners of the CoW-branded Watch & Gnosis Pay Card:**

1.  0xef5e42549886b9b060ee0381a3819ecaf0fdaeda
2.  0x38fe3792cea65f37cac5474dca8fff887e6d90b1
3.  0x2a4e4ab5e6680b76e00ad4555e39d2dcca42a659
4.  0x23a02d9e5d6ad9419128663976315689204be895
5.  0xf4a82a72faf46b2c55cdad3bcf7c0c1b564bab30

**Winners of just the Gnosis Pay Card**:

1.  0x3bc0cb287f74504347d50fe3ada6d90214e6f512
2.  0x952656cb0121d79a320bb0a7188fb4abb2b5dd94
3.  0x2855159d938d09d00d4fccf42f69ccb8f5b620e2
4.  0xdb72b7dc6ddf0c95468ce19b6539b9a44e561679
5.  0x3e23fd468f65e77aea8f548ebd382e86e7a99309

Congratulations to the winners and thank you to everyone who participated!

To claim your prize, please  [DM us on Twitter](https://twitter.com/CoWSwap)  by November 1st.



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Attention all traders, the CoW Swap herd is thrilled to announce TWAP-tember, the greatest trading extravaganza of the year!


Introducing TWAP-tember

Don’t worry, trade happy! CoW Swap has been busy cooking up Conditional Orders, an architecture that allows developers (and their users) to create sophisticated orders of all kinds. At the core of this system is a flexible smart contract wallet that allows the protocol to implement its unique logic. What’s better than standing on the shoulders of giants in the ecosystem and within the Gnosis family  [Safe](https://safe.global/)?

Wait? Smart contract wallet?

That’s right: CoW Swap pioneered intents across the Ethereum space for EOAs (think MetaMask, Trezor, Trust Wallet, etc.), but what’s less well-known is that the protocol can actually work in a similar way for smart contracts by relying on a flexible intents system with the ERC-1271 integration. It sounds technical, but this standard is basically designed to allow smart contracts to “Sign” a message like any other EOAs. This is a familiar procedure for the seasoned CoWmunity, but Conditional Orders now allow anyone to define a set of conditions and have the smart contract wallet do the clicking for you.

Incubated through the  [CoW Grants Program](https://grants.cow.fi/), and supported by the Safe team throughout the testing/auditing process, the ExtensibleFallbackHandler is now live. Sounds complicated, we know! Put simply, this is a way to add extra powers to your Safe, while preserving the strong security guarantees that the Safe is well known for.

Upgrading your Safe’s fallback handler is a secure process, all you have to do is tick a box when placing an order, and your Safe upgrade will be batched with your order, making for a single-transaction order placement and upgrade. The contracts that implement this system have been audited both by an independent auditor, and an external auditor from Ackee Blockchain (You can read the final audit reports  [here](https://github.com/cowprotocol/composable-cow/tree/ab3addad9bc05acdbf5fb040eb5c336209b58e31/audits)).

The owl-eyed among you would be aware that smart contracts have always been able to use CoW Protocol, though this required both a transaction on chain to signal your intent, and that the orders be fixed (not conditional). Wave goodbye to these limitations!

With an ExtensibleFallbackHandler+ComposableCoW-enabled Safe you now benefit from all the CoW Swap features directly from your smart contract wallet: MEV protection, no failed swap transactions, at-execution path discovery, conditional orders, and batching if you need to do pesky things like approve or wrap ETH.

If you’re technically inclined, check out how you can  [start building with conditional orders using ComposableCoW](https://hackmd.io/@mfw78/HyuvoGt9h#), or drop into  [#tech-talk on our discord](https://discord.gg/cowprotocol)! While you’re busy reading up on how to write the latest and greatest conditional order, you could also be gradually buying up more of your favorite token using TWAP!

## What is a Safe fallback handler?

Long story short, Safe is designed to have strong security guarantees over basic operations (think executing transactions, spending your precious tokens, etc.), but there’s not enough time to program all functionality that a user may require. Therefore, the Safe can “forward” all function requests that it doesn’t recognize to another contract (the fallback handler).

**CRITICALLY**: Fallback handlers do  **NOT**  have the same authority as the Safe from which they were called. Due to the security architecture of Safe, it is not possible for the fallback handler to execute transactions on behalf of the Safe.

OK, the fallback handler can’t execute a transaction for you, so why should you care? Safe doesn’t by default (without a fallback handler) support ERC-1271 signatures. The standard deployment of a Safe deploys with CompatibilityFallbackHandler as the fallback handler, which has limited ERC-1271 support (meaning: it cannot read and thus, cannot be automated). CoW Swap intents super-charge this by allowing a Safe to also specify a smart contract that can sign messages for a particular application on its behalf.

This is where ComposableCoW takes over! 🐮🎶 You can think of ComposableCoW as an autonomous agent, signing orders that meet whatever conditions you have specified. After you create your first conditional order, the second transaction you see in the batch will enable ComposableCoW, which tells your Safe “I want ComposableCoW to be able to sign orders from CoW Protocol”. TWAP is just a conditional order type that works with ComposableCoW.

**CRITICALLY**: Due to the design of ERC-1271, all signature verification is  **read-only**  which means it is  **impossible**  for a ComposableCoW or any conditional order to directly access user funds (the movement of funds during a swap is initiated by the settlement contract  **ONLY**).

In summary, to make CoW Swap’s new TWAP order feature work:

-   Safe users need to upgrade their fallback handler(enables conditional signing)
-   Conditional orders are automatically placed in the CoW Protocol order book (now signed with the new handler)
-   Automated signing of orders means you may hear less of CoW’s trademark moo. Feel free to set  [this](https://github.com/cowprotocol/cowswap/blob/develop/apps/cowswap-frontend/public/audio/success.mp3)  as your phone’s notification tone if suffering withdrawal symptoms 🐄

CoW Swap takes security very seriously. The underlying Safe fallback handler code has been fully audited by both the Safe and CoW teams as well as by two independent external auditors, G0 and Ackee Blockchain. You can find all the audit final reports  [here](https://github.com/cowprotocol/composable-cow/tree/ab3addad9bc05acdbf5fb040eb5c336209b58e31/audits).

The solution presented follows Safe’s high security standards. What’s more, the fallback handler isn’t just about placing orders. It allows limitless and, as of yet, unknown functionality. Maybe you want to:

-   Define a custom method handler for any non-standard method (if you really want you can turn your Safe into an ERC-20 token)
-   Define a custom EIP-712 domain verifier, whereby a contract implementing ISafeSignatureVerifier can do your menial signing automatically (it is this interface that ComposableCoW implements to power the shiny new TWAP orders)
-   Define a set of methods (interfaceId) that your Safe supports, and report such using ERC-165

The architecture for the ExtensibleFallbackHandler can be viewed  [here](https://hackmd.io/@mfw78/HyuvoGt9h).

**NOTE**: Audits are not a guarantee that code is free from error. Use with caution.

We wish you much surplus and happy  [TWAP order trading](https://swap.cow.fi/swap?utm_source=medium&utm_campaign=fallback-handler)! Give  [TWAP orders a try](https://swap.cow.fi/swap?utm_source=medium&utm_campaign=fallback-handler)  today and let us know what you think by reaching out on  [Twitter](https://twitter.com/CoWSwap)  or  [Discord](https://discord.com/invite/cowprotocol)!



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Don’t worry, trade happy! Upgrading your Safe fallback handler is a secure process. This Safe fallback handler extension has been developed by the CoW Swap team in collaboration with the Safe team, and has undergone a successful audit.

All you need to know about CoW Swap’s new Safe fallback handler

> _Note: TWAP orders are most useful for big trades! So, when trading on Mainnet, the minimum TWAP order size is $5k. This minimum ensures that your savings from reduced price impact are not lost on execution fees (AKA gas fees). If you want to trade smaller amounts, head over to Gnosis Chain, where the TWAP order minimum is only $5 (and the gas fees are much cheaper!)_

TWAP orders are now available in the  [CoW Swap order interface](https://swap.cow.fi/#/1/advanced)  under the “Advanced” tab.

**Have a Safe?**  Awesome! You can try out TWAP  [here](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=TWAP-guide).

**Don’t have a Safe?**  Not a problem! Create one  [here](https://app.safe.global/share/safe-app?appUrl=https%3A%2F%2Fswap.cow.fi&chain=eth).

For the below guide, we already have a Safe created. To get started, navigate to  [CoW Swap](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=TWAP-guide)  and connect your Safe wallet via Wallet Connect, or directly using the CoW Swap Safe native app.

Once your wallet is connected, there are two ways to access TWAP orders:

-   Next to “Limit” in the center module, there is a tab that says “Advanced Orders” → clicking this opens the TWAP orders interface
-   On the top-left corner of the page, next to the CoW Swap logo, it says “Trade” → clicking this opens a drop-down menu that lets you choose between “Swap,” “Limit orders,” and “Advanced orders”

Once you have selected the “Advanced” tab, you will see the following screen:
![1-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_twap_how_to_6290090db4.webp)

After you click “Unlock TWAP orders (BETA)”, you will be taken to the TWAP orders interface.


![2-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_twap_how_to_0171b4ab6d.webp)

On the left side of this screen, you can see the order box where you input your TWAP order parameters. On the right, there is a panel that shows your open orders and order history.

In order to place a TWAP trade, you need to input your tokens and amounts, indicate how many parts you would like to split your order into, and select the time duration of your order.


![3-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/3_twap_how_to_c1d0d380d2.webp)

To get started, select the tokens you would like to swap from the token list.


![4-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/4_twap_how_to_961f05a961.webp)

Once you’ve chosen your tokens, you need to select the numbers of parts your TWAP order will be split into, as well as the duration of the TWAP order as a whole.


![5-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/5_twap_how_to_577542d502.webp)

As an added bonus, trading via a smart contract wallet like Safe automatically bundles your approval transaction and your trade together to save you time and gas.


![6-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/6_twap_how_to_bcfd7564ec.webp)

Below the Safe bundling banner, you will see a yellow notice. This notice is not related to your TWAP order itself, but to your wallet. TWAP orders are based on the “Composable CoW” conditional order framework which uses Safe fallback handlers to enhance the functionality of your smart contract wallet.


![7-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/7_twap_how_to_5563d17bc7.webp)

In order to use TWAP orders, you will need to upgrade your Safe fallback handler. This is a secure process; the code was co-developed by CoW Swap and the Safe team and it has undergone two external audits (you can find the final results of the audits  [here](https://github.com/cowprotocol/composable-cow/tree/ab3addad9bc05acdbf5fb040eb5c336209b58e31/audits)).

_Note: if you are interested in learning more about the fallback handler upgrade process, please refer to this_ [_article_](/learn/all-you-need-to-know-about-cow-swap-new-safe-fallback-handler)_. If the fallback handler is new to you, please refer to this Safe_ [_article_](https://help.safe.global/en/articles/40838-what-is-a-fallback-handler-and-how-does-it-relate-to-safe) _for a full introduction to the concept._

Once you understand how the fallback handler interacts with your Safe wallet, you can check the “Modify Safe’s fallback handler when placing order” box in order to upgrade your wallet. This upgrade will take place alongside your trade and bundle any token approvals as a single transaction.


![8-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/8_twap_how_to_6aab5754fc.webp)

After you click “Approve”, you will be prompted to review your order one last time. Review all of your order details including the price protection, limit price, the minimum tokens you’re set to receive, and all your TWAP properties and ensure everything looks good.


![9-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/9_twap_how_to_39ea16bee1.webp)

To actually place your TWAP order, click “Place TWAP order” and review & sign your transaction from your Safe interface.


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![11-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/11_twap_how_to_e39305a40f.webp)

After you sign your order, you will see an “Order submitted” pop-up and your order will appear in the order panel on the side.


![12-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/12_twap_how_to_71bea598ed.webp)

In the order panel, you will notice that the order status is not “open,” but rather indicates that your order is still in the “signing” stage. The wallet used in this example requires 2 out of 3 signers to execute a transaction. By creating the transaction, we have performed one of the signatures, and to reach the threshold we need one more signer. To sign, the second signer would need to connect to the Safe wallet and navigate to the “Transactions” queue.


![14-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/14_twap_how_to_a703daa281.webp)

In the queue, we can see our pending transaction and confirm it with the last signature required.


![15-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/15_twap_how_to_f995c65744.webp)



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After the last confirmation for the order is done, the order is placed and it will appear in the “Your Orders” UI.

The interface includes several ways to view your orders. You can get a high-level overview at a glance, expand to see the different parts of your TWAP order (in this example the first part executed immediately, which is why only 3 parts are shown), or click into the order to view a full list of details.


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Now that your TWAP order is placed, you can sit back, relax, and watch it get filled with CoW Swap’s signature MEV protection and best prices.


![21-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/21_twap_how_to_935598c651.webp)

We wish you much surplus and happy  [TWAP order trading](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=TWAP-guide)! Give  [TWAP orders a try](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=TWAP-guide)  today and let us know what you think by reaching out on  [Twitter](https://twitter.com/CoWSwap)  or  [Discord](https://discord.com/invite/cowprotocol)!


![22-twap-how-to.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/22_twap_how_to_07e8708fcb.webp)



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How to use CoW Swap’s TWAP orders via Safe Wallet, step by step guide


How to use CoW Swap’s TWAP orders via Safe Wallet

TWAP orders allow traders to spread their trade over a specified period of time in order to smooth out fluctuations in market price and open a position for an average market price. A TWAP order consists of multiple smaller orders placed at regular intervals over a predefined time period.

> **In our tests, selling 1,000 ETH in four parts of 250 ETH each, allowed us to yield a price for the order that was 3.5% better than selling the 1,000 ETH all at once!**

## TWAP Order Interface

To get started with TWAP orders through the  [Safe](https://app.safe.global/)  app, you will first need to authorise a transaction signing request that contains a batch of transactions (we’re big fans of gas savings through batching ⛽🚫). This batch includes a “setFallbackHandler’’ function. TWAP orders are the first order type that runs on a new conditional order framework, super-charging your Safe.

In order for this framework to make complex trades on your behalf, an upgrade to Safe’s “fallback  handler” is required. Don’t worry though, you will be automatically prompted to upgrade in order to use TWAP.

![1-twap.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/1_twap_9fef6b1d70.webp)


The TWAP interface has several sections:

-   **Trading Assets**: Select the assets you want to swap and the amounts of each.
-   **Price Protection**: Provides protection against major price movements. Your TWAP order won’t execute if the market price dips more than this percentage (calculated from the asset price at the time of order submission).
-   **Number of parts**: Enter the number of parts you would like your order split into.
-   **Total Duration**: The total amount of time your order will take to execute.
-   **Part Duration**: Automatically calculated from your total duration and number of parts, part duration shows how long CoW Swap will wait between each part of your order.
-   **Sell & Buy per part**: Shows an estimate of how much CoW Swap will sell and buy with each part of your trade.

## Benefits of TWAP Orders

TWAP orders have been widely explored through research literature in traditional finance but haven’t yet seen the light of day in DeFi. They’re finally entering use on exchanges such as CoW Swap and they provide a range of benefits for traders.

**Reduce your slippage**: Breaking up a large order into smaller pieces allows you to set a smaller slippage tolerance for each piece than if you had executed the large order as one.

**Reduce your price impact**: As with slippage, breaking up a large order into small pieces allows you to spread your liquidity needs over time, reducing your price impact.

**Always receive 100% of your order surplus**: On CoW Swap, all order surplus is forwarded to you. If your order executes for a better price than your quoted price — thanks to  [Coincidence of Wants](/learn/what-are-cows-on-cow-swap)  or any other price improvement that solvers are able to find — the extra price improvement will be forwarded to you.

**Eliminate market fluctuations**: By giving traders the time-weighted average price, TWAP orders smooth out market volatility, which makes trying to predict prices a thing of the past.

**Customise your order parameters**: TWAP orders allow you to fine-tune your order by specifying the number of parts you’d like it split up into, as well as the time period you want it to execute over. On CoW Swap, TWAP orders also have a “price protection” option which protects your order from executing at an unfavorable price due to market volatility.

## Get Started with TWAP Orders on CoW Swap

TWAP orders are now available in the  [CoW Swap order interface](https://swap.cow.fi/#/1/advanced)  under the “Advanced” tab.

**Have a Safe?**  Awesome! You can try out TWAP  [here](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=TWAP-announcement).

**Don’t have a Safe?**  Not a problem! Create one  [here](https://app.safe.global/share/safe-app?appUrl=https%3A%2F%2Fswap.cow.fi&chain=eth).

The CoW Swap team is working on adding support for more wallets in the future.

One more thing to note: TWAP orders are most useful for big trades! So, when trading on Mainnet, the  _minimum_  TWAP order size is $5k. This minimum ensures that your savings from reduced price impact are not lost on execution fees (AKA gas fees). If you want to trade smaller amounts, head over to Gnosis Chain, where the TWAP order minimum is only $5 (and the gas fees are much cheaper!)

As always, on CoW Swap:

-   All prices are aggregated from the best available on-chain and off-chain liquidity.
-   Traders are fully protected from MEV.
-   Orders are free to place and free to cancel.
-   Traders never pay for failed transactions.
-   Transactions are gasless as fees are paid in the sell token.

Celebrating ComposableCoW’s conditional order superpowers, we are releasing it with TWAP (time-weighted average price) order support for enabled-Safe users.

Give  [TWAP orders a try](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=TWAP-announcement)  today and let us know what you think by reaching out on  [Twitter](https://twitter.com/CoWSwap)  or  [Discord](https://discord.com/invite/cowprotocol)!

![2-twap.webp](https://celebrated-gift-f83e5c9419.media.strapiapp.com/2_twap_2220db98f0.webp)

We wish you much surplus and happy TWAP order trading! Give  [TWAP orders a try](https://swap.cow.fi/#/swap?utm_source=medium&utm_campaign=TWAP-announcement)  today and let us know what you think by reaching out on  [Twitter](https://twitter.com/CoWSwap)  or  [Discord](https://discord.com/invite/cowprotocol)!

_Please note that TWAP orders currently require a_ [_Safe_](https://safe.global/) _wallet with a fallback handler. More wallets will be supported in the future._



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CoW Swap is excited to announce the launch of Time-Weighted Average Price (TWAP) orders! Available now as an advanced order type in the CoW Swap order interface.


CoW Swap Launches TWAP Orders

CoW DAO develops the most user-protective products in Ethereum - so you can do more with less worry.

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