DeFi experience for DAOs with Anna George

you hear me yeah cool all right thanks everyone to for coming to this car my name is Anna I'm co-founder of cow Swap and today's talk is going to speak about not only Dao's even though I think in the agenda originally the title was down related but generally how to trade on cow swap what the advantages are from trading on call Swap and then why specifically daos are also benefiting from trading on Carswell so we are starting off with a few statistics just to let you know we have been basically live for almost two years and since then we have become the second largest Dex aggregator and by now have the highest retention rate across all ecrom Texas we have since we launched transferred 20 billion dollars in funds and we have a lot of users and our user base is constantly growing speaking about our users we actually have here an overview of how our user groups compare to the user groups of our competitors of other dexes on ethereum and interestingly basically the two graphs on top compare the volume and then the lower two graphs compare the number of Traders and then we categorized what types of Traders are more attracted to the usual amms that you know compared to what types of Traders are usually trading on cow swap you can see that the basically the users that are more and practice work before tomorrow's ceremonies and come on down to the real power stage at 6 PM again if you want to practice all right um for everyone who doesn't want to leave to practice their pitch I continue and so the interesting part here basically is that the type of user that's using on Cal swap is usually more what we would classify as a DEX aggregator or whale user so someone who is more large volume Trader they typically also have a larger diverse portfolio of tokens and we are actually targeting all users also number retail users but because of the advantages that we offer the people who really trade a lot of volume usually prefer going on call swap speaking about large volume Traders we actually made news a couple of weeks ago when we transferred or when we processed a trade of 16 million dollars it was done by ens by the ens Dao one of the biggest Dows in the space they had the need I think to basically secure some funding for paying salaries for the next year and a half they wanted to convert 10 000 ether for usdc and they had public Dow discussions on where they would want to process this trade and after long discussions they basically came to the conclusion that they would wanted to settle this trade by a cow swap the question is why did they pick house up first before we explain this I want to make everyone understand what's like different about a dow related transaction compared to normal user transaction the difference is if as a dow you want to decide what type of transaction you will do and you have your entire Community discuss this with you you will first have to set up a proposal that already includes the transaction details so now after the proposal is created you basically have to wait right you have a voting period where now your tokens stakeholders will decide whether than favor of the trade execution or not and many for many doubts this voting period lasts seven days in the case of ens it was actually even a little longer then finally after the voting period has passed if the community is in favor for executing this trade David then triggered the transaction but remember the transaction details were crafted at least seven days ago so what happens now if you were to place a trade that was crafted seven days ago on any of the normal taxes like uni swab or one inch um you you would basically have two options option number one is again you crafted the transaction already with the fixed execution route with a fixed price point and with fixed slippers so now it's seven days later and the only way that you can ensure that this trade actually will be executed is that you define a very large slippage tolerance because of course there's a lot of Unchained price movements meaning if you don't allow for slippers most likely your transaction Is Not Gonna Last it's not gonna it's not going to be possible to be executed so you have to put a very large snippet but imagine putting 10 slippage Tolerance on a 16 million dollar trade there's a lot of money on the line that you could lose and if you had done this trade where one inch or uni swap it would have been visible on Shane for any Mev exploiting Bots for seven days or longer and for sure you can place a bet that this money would have been extracted scenarios two is you are aware that slippage your slippage is at risk hence you're not willing to set a 10 slippage tolerance you put a very very tight slippered you wait for seven days there was a lot of Unchained volatility probably the price is not the same anymore that was seven days ago and you have a high risk of your of your order to fail not only does this mean that you basically paid transaction costs for an order that never was executed but much much worse as you probably have to do the whole Unchained voting process again craft a new transaction and hope that the next time the execution actually the transaction actually passes now what happens if you were to do this on cow swap instead of any of the other normal dexes one very big difference is that on cow swap you actually sign a message so you're not crafting an ECR transaction you only sign an intent then what happens after the voting period passes and these servers are actually and your trade is actually supposed to be executed Cloud swap engages in a server competition where external parties are all competing against each other to find the best possible execution path for you at the moment of execution not what was the best task seven days ago then these servers are also looking into Coincidence of ones we will talk about this in a second and very importantly they will also protect you against these Mev exploitations all right let's go through this in more detail first as I mentioned before the user or Dao sends an intent to trade this means that you do not commit to fix execution paths you do not pay for a transaction cost unless the transaction actually is finally mined and very importantly there's also a way how you do not have to commit to a specific price but we will get back to this in a couple of minutes then what we talked about already briefly is we have the Cyber competition as mentioned they will look at time of execution what is the best possible execution pass for your trade and they do this not only by occurring on existing Unchained liquidity they also query one inch pair so much everything and they also have their own path finding algorithms and also integrate their own Market maker liquidity to ensure they can really trade your execute your trade optimally they compete and only the server that finds the best possible price for you is the one that wins then what is special also about cow swap is they can also match your trade against another user's trade we call this Coincidence of once this is where the name Cow swap is coming from and by batching you against other user trades you get additional Price benefits because if you can be matched against someone else there's less price impact you pay less gas costs and all the volume that is directly matched peer-to-peer is protected against Meb then the last step and this is actually very very important part of cow swap is that your trade is protected against Mev so not only do servers when they execute your trade they check what's lipid tolerance is actually necessary at moment of execution to submit your trade successfully so let's say that you committed to two percent slippage tolerance but it's actually only 0.2 percent is required for your trade to actually be executed they will only submit your trade with a reduced slippage tolerance so that the remaining slippage cannot be exploited on top of that also servers are responsible for carrying the execution risk so what happens the service engagement competition the best the server is the best solution wins the competition and they are bound by smart contracts to provide you exactly that price point that they promised to give you so in case when they're executing your order and you're being sandwiched the server has to pay that cost the user is not impacted by the sandwich attack so I mentioned before that there's one essential step that on top is possible with Carlos web that allows the user to not predefine a fixed price and this is facilitated with the token standard esc1271 which basically allows to verify off-chain signatures created by smart contracts and um yeah so why is this important is we had a grant that was uh executed by the Yuan team actually by sub team members from the yarn team that for their own purpose we start okay actually we want to trade on car swap but there's one thing missing for us which is that we cannot previously commit to a fixed price because we want automated integration of cows up so they created a service that we refer to as the Milkman servers which consists of two things it's basically it's one smart contract in one bot and you if you are interested to trade on carlswope for uh set up a trade already that will only be executed sometime in the future you don't know what the unchain price point is going to be then you use movement basically all you need to do is you need to approve the smart contract approve it for the token that you want to sell then you query the moments my contract with following parameters you need to specify what's the amount in basically the token you want to sell you need to specify um what token what erc20 token you want to swap out what which one you want to receive what is the receiver address and now the very important part is you can also set a price checker Enterprise Checker is an address which can for example which is basically the price Oracle so you could choose a uni swap pool as your price Oracle or you could even come up with something more sophisticated where you would basically take the average of multiple Unchained pools and then once you create a smart contract it emits an event and the Milkman bot is picking up the order automatically and it's that's set on cow swap and this is exactly what ens did and by doing this not only did they successfully execute their trade they were able to previously Define a slippage tolerance of two percent however when the bot picked up this order I realized okay we are only it's only adding 0.5 percent slippage on top and so the only 0.6 percent slippers were required for the price impact of the 10 000 Esa order which is very low none of the slippage tolerance was exploited none of it so there was no Mev attack the Mev Bots could have taken eighty thousand dollars from the order but they didn't and yeah so there was a very successful first experiment of the Milkman order and it's really cool to see that now other dials are following for example noun stars now also working on um doing a trade using movement on car swap yeah so there's many different use cases of how you can leverage this the smart orders on castle one is the one we just talked about it's a very simple swap that can be done by a dial for many different purposes it can be done because you want to diversify your portfolio it can be done because you need to do a payment or because you want to invest in specific assets and many more use cases basically that just require you to do a simple SWOT with finding a price point that's in the future um we are like I mentioned we are working with nouns now we have worked with ens we are now also working with tally Tally is going to integrate us natively in their UI which is going to make it even easier for people in the future to use calcium for automatic Trading then another nice use case for D5 is TiVo orders that's basically means time weighted average price trading that is if you want to build up a portfolio over time this is the way to go um it's strategically smarter to not if you let's say you want to invest in ether to not buy all your East today because you don't know how the price is going to develop over time so instead what you can do is you can set up T-Bob orders where basically every day every week or every month you are committing to buying a certain amount of ether and yeah that's basically for that we also have already we are using ESC 1271 and we have also special contract code that is linked here under the QR that guide you through the process of how you can create your own tiva borders and then there's many many more use cases as well that you can do via cars or one big one for example is liquidations so imagine that you want to check that whenever your collateral rate of your portfolio is below certain of someone's portfolios below a certain amount you want um to liquidate those assets you can do this via color Swap this my contract could automatically verify and validate whether the balance is too low and then trigger a sell order the reason why it would be nicer to do this via carlswope than via the traditional liquidations protocols is that this is an inherently better user experience because there's less price impact if you do it via calls up and the trades of the user are protected against MAV liquidations is always an event that sucks at least let's try to make it a little bit better for the user that at least they get a little better price for when they get liquidated another use case for colors of smart orders for example could be automated rebalancing this is interesting for any D5 protocol that is that basically managing portfolio of other projects and by integrating Castle they could manage these portfolio assets fully trust the C and then that's the another use case that comes to mind is automated recollateralization basically the opposite of liquidations if you have been liquidated in the past you don't want just to have many more in the future you could set up cows were basically in a way that it always checks whether you have enough Assets in your portfolio if you go below the collateralization rate you could automatically trigger a buy order to increase the rate of your portfolio to ensure you won't get liquidated and yeah this is just to spark some ideas there's many more use cases for smart orders um now basically since we had a hackathon we want you guys to build your own there's a QR code to our bounties it's not too late even if you don't submit it by tomorrow um we were always happy down the line to fund more projects to to build on top of Castle here another two QR codes one to the movements my contracts and one to the T web smart contract and last weekend shout out to the different projects we are collaborating with I mentioned tally announced our ens so we are collaborating with the nurses safe and with zodiac just basically to bring cow swap make it easier for anyone who's interacting with those and needs to do some sort of portfolio management to to do this via Council and that's it thank you very much for listening [Applause] foreign [Music]