Social Consensus Rules

Social Consensus Rules:

In TX Swap, the smart contract does not enforce social consensus rules. However, through the Tx Swap Improvement Proposal (CIP) process, the DAO has established these rules to promote healthy competition and ensure fair practices among solvers. Violations of these rules can result in penalties or even slashing, as determined by the DAO. The following social consensus rules are in effect:

No Provision of Unfair Solutions (CIP-11): Solvers are prohibited from proposing solutions that provide unfair advantages. The uniform clearing prices computed by solvers should match or exceed what users would obtain elsewhere. This rule is particularly important for solutions involving CoWs, where some volume is settled directly instead of being routed through an AMM.

Inflation of the Objective Function (CIP-11): Solvers are not allowed to artificially inflate the objective value or maximize rewards by using tokens solely for manipulation. Actions such as creating fake tokens or engaging in wash-trading with real tokens are strictly forbidden.

Illegal Use of Internal Buffers (CIP-11): The internal buffers provided by the protocol can only be used to replace legitimate AMM interactions that are available to the general public, to reduce transaction costs. Any other use of these buffers is considered illegal.

Failure to Report Correct Transacted Values for Encoded Transactions (CIP-11): Solvers may include encoded transactions in their solutions by providing relevant calldata. However, they must accurately specify the amounts transferred by each encoded transaction. This is essential for verifying the proposed token conservation constraints, and retrospective checks can be conducted to ensure compliance.

Other Malicious Behavior (CIP-11): Malicious behavior by solvers extends beyond the examples mentioned above. The DAO has the authority to slash solvers for intentional harm caused to users or the protocol. An instance of such behavior includes a solver intentionally omitting the pre/post hooks associated with an order.

These social consensus rules in TX Swap promote fair competition, discourage manipulative practices, and safeguard the interests of users and the protocol.