Exciting news – @CurveFinance is using CoW Protocol for its new fee collection mechanism!
Curve has various sources of revenue, one via LP tokens. To distribute these fees, Curve first needs to convert them into a unified token. That's where programmatic orders come in.
A 🧵
With programmatic orders, Curve is able to collect fees from their AMM pools automatically and swap all fees together, efficiently, into a common target token – without any manual intervention.
blog.cow.fi/introducing-the-programmatic-order-framework-from-cow-protocol-088a14cb0375
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Curve's system works in 4 parts:
💰 Fee collector - Entrypoint Smart Contract (SC) for fee burning system
🐮 CoW Swap burner - SC which burns collected fees into a unified token
🪝 Hooker - SC that allows users to execute Hooks
🪝 Fee distributor - SC that distributes fee tokens
You can find a more detailed explanation of how Curve's new fee collection mechanism works in their docs:
docs.curve.fi/curve_dao/fee-collection-distribution/curve-burner/overview/ 📒
resources.curve.fi/governance/fee-collection-distribution/ 📒
And you can see Curve's new fee collection mechanism in action, today.
Take a look at this feeBurner order 👉
explorer.cow.fi/tx/0x9e85293be807c6d3926580d716a5e0ca9672c5b5ea2a64eac2f35c78b5bc7d4a?tab=orders, where 7 adminFees orders were submitted to settle at the same time for a single token.
All the 7 orders were created automatically by the fee collector, and placed inside the CoW Protocol order book.
As you can see, the settlement is complex due to the involvement of various contracts and the exotic nature of the Curve LP tokens.
On average, these 7 orders, got 75% more CRVUSD tokens than they asked for (😳) thanks to CoW Protocol. They would not have been able to achieve results like this with hard-coded execution paths.
To find more orders like this, see Etherscan: etherscan.io/address/0xC0fC3dDfec95ca45A0D2393F518D3EA1ccF44f8b#tokentxns
Thanks to CoW Protocol, Curve can submit orders without knowing the price in advance, ensuring fair market prices. This ability to program orders without hardcoded paths has reduced maintenance and achieved better prices for Curve.
TL;DR
Programmatic orders from CoW Protocol enable a range of complex DeFi actions. @CurveFinance is now using them to automate its fee collection process, and getting superior results for veCRV holders.
Come build any DeFi action you can imagine 👉 docs.cow.fi/category/tutorials?utm_source=cow.fi&utm_medium=web&utm_content=link 🐮