Trump's official DEX CoW: Revenue of $6 million last year but still in the red

Author: Frank, PANews

Recently, the Trump family's crypto project World Liberty has increased its holdings of Ethereum and other assets. In the process of increasing holdings, almost all operations were completed through the CoW Protocol. It seems that the Trump family has a special love for this aggregator. In addition, Ethereum founder Vitalik and the Ethereum Foundation also frequently use CoW Protocol when transferring and trading assets. However, for ordinary users, the CoW Protocol is obviously not as well-known as DEX products such as Uniswap and 1inch. Until recently, due to the use of the Trump family, the attention to CoW Protocol has been raised to a higher level, and its token COW has also risen after Trump was elected. From November 6 to December 25, it rose by as much as 392%.

The "OTC market" in DEX is favored by big players

CoW Protocol was created in 2020 and incubated by the Gnosis team, an Ethereum infrastructure builder. Its founder, Anna George, is also the business director of Gnosis. From 2016 to 2017, Anna George served as a monitoring and evaluation expert for the United Nations.

As of January 23, data showed that the number of daily active users of CoW Protocol only reached more than 1,000 even after a significant increase. The number of daily users before was only a few hundred people per day. But in terms of cumulative trading volume, the cumulative trading volume of the project has reached 77 billion US dollars, which ranks seventh in the Ethereum ecosystem. In December 2024, CoW set a trading volume of 7.8 billion US dollars. Based on the daily active users of about 1,600 in December, the average monthly transaction amount completed by each user on CoW reached 4.87 million US dollars. From this point of view, CoW is worthy of its reputation as an exclusive trading pool for large users.

CoW Protocol has many technical features. In terms of effect, it mainly eliminates MEV and low transaction friction. The most characteristic core technical principle used is the "demand matching" mechanism. Regarding "demand matching", I will not give too much technical explanation here. In layman's terms, this mechanism is more like reaching an on-chain OTC market, crossing the demand of the AMM liquidity pool and directly matching two large users with the same demand for pricing transactions. In this way, the MEV and transaction wear on the chain are almost zero.

For users who trade millions or even tens of millions of dollars each time, this mechanism directly hits the pain point and can also minimize the impact on market prices. This also explains why the Trump family project World Liberty chose to use CoW Protocol for asset allocation. At the same time, the Ethereum Foundation and Vitalik and others are also keen to use this project. The Ethereum Foundation has sold coins many times through CoW.

But on the other hand, for ordinary users, the most consideration may be transaction speed, the number of transaction categories, and flexible trading pools. In contrast, the matching mechanism of CoW Protocol does not lead in these aspects. But it doesn't matter. For CoW Protocol, it seems to be designed for big users from the beginning.

The data has indeed improved, and the income level is expected to increase

Recently, CoW Protocol has benefited from the World Liberty project. Since November 6, the price of its governance token COW has soared, from a minimum of $0.25 to a maximum of $1.23. The maximum increase reached 392%.

The COW token was issued and launched as early as 2022. The earliest opening price was about $0.8. In the following year, the price fell all the way, falling to a minimum of $0.062. It did not start to rise until 2023, but most of the time it hovered below $0.4. It was not until September 2024 that Coinbase announced that it would introduce CoW Protocol into the currency listing route. On November 6, Binance, Bybit and many other exchanges launched COW. Interestingly, this day was also the day when Trump won the 2024 US election. It can be seen that various exchanges have added COW to the Trump series of related assets. As soon as the election results came out, it immediately triggered market pursuit.

However, since Christmas, the price of COW tokens has begun to pull back all the way. As of January 23, its price has fallen to around US$0.63. Calculated from the high point, the overall pullback is close to 50%.

Apart from the traffic effect brought by the hot spots, the data performance of CoW Protocol itself has grown tremendously in recent months. The most obvious is the trading volume. Since 2024, the monthly trading volume of CoW Protocol has basically fluctuated between US$2 billion and US$3 billion. Starting in November, this data began to surge to US$6.2 billion, and in December it reached an all-time high of US$7.8 billion. Throughout 2024, CoW Protocol's market share in Ethereum ecosystem aggregators has always been lower than 1inch, ranking second. On January 23, 2025, the data performance of that month has exceeded 1inch for the first time, ranking first. However, the final ranking of the two for the month may not be known until the beginning of next month.

On January 22, Cow DAO released the CIP-61 proposal on Snapshot, attempting to achieve a better level of income by further standardizing the charging model and ratio of CoW Protocol. According to the proposal, CoW Protocol achieved a total revenue of approximately $6 million in 2024, but still failed to break even, with development costs ($4.4 million), grants ($700,000) and solver rewards ($5.2 million) that year. Therefore, Cow DAO hopes that through this proposal, it can optimize the transaction execution price of users, create more additional value to achieve break-even as soon as possible, and get rid of the need for external funds.

According to the official panel of CoW, the cumulative income of CoW DAO is 3648 Ethereum. Calculated at the price of Ethereum of $3,300, the total income is about $12 million. In the Ethereum ecosystem, the income level of CoW Protocol can be ranked around 50th. As an aggregator with a four-year operation and a leading transaction volume, this income level is indeed low.

Coupled with the overall improvement of recent data, the CoW team obviously hopes to seize the current market opportunities and achieve new milestones. At present, the proposal has been successfully passed, but the discussion on social media is not high. The token market has not seen significant price fluctuations as a result. Perhaps, for the CoW team, capturing large households only requires targeted products and designs, but capturing the masses seems to be much more difficult. For ordinary users and token investors, complex proposal expressions seem far less cost-effective than a simple airdrop.