CIP-23: Renewing the solver reward budget

CIP: 23
title: Renewing the solver reward budget
author: middleway.eth
status: active
created: 2023-02-09

Simple Summary

The previous solver rewards budget was defined and approved in CIP-10, over six months ago. Expenditure on solver rewards in this period were very closely according to estimations in CIP-10, COW tokens allocated for this purpose are going to be depleted roughly at the end of February.

This CIP is intended to propose a new budget for solver rewards.

Motivation

There are 12 independently running solvers at the time of writing, consistently competing to provide batch solutions and consequently ensuring best-execution for CoW Swap users. It is safe to assume that a major motive for running a solver is winning solver rewards. This proposal aims to ensure appropriate funding to continue rewarding solvers and hence supporting a competitive solver landscape.

It is important to note that this budgeting proposal is independent of additional proposals to potentially change the solver reward structure (CIP-Draft: Auction model for solver rewards), which can be configured for appropriate spending according to the budget.

Specification

Transfer 10M COW from CoW DAO (0xca771eda0c70aa7d053ab1b25004559b918fe662) to the Solver Rewards safe (0xA03be496e67Ec29bC62F01a428683D7F9c204930)

Rationale

Solver rewards are planned to continue using the same operational structure, carried out from the solver rewards safe. ETH for compensating gas execution costs is estimated to be fully covered by collecting fees from users.

It is proposed to allocate 10M COW tokens for a 6 month period of rewards. This represents a yearly budget of 20M COW tokens, 2% of the COW token supply, valued at $2M according to current market price.

Safe Transaction Data

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Tenderly Simulation

Link to Tenderly simulation