MuesliSwap, a decentralized exchange (DEX) on the Cardano network, has announced its decision to reimburse its users that have been affected by high slippage over the past year. This is in response to the recent questions faced by the protocol on its slippage feature.
Slippage refers to the price difference between when a transaction order is submitted and when the transaction is executed by the market maker and confirmed on the blockchain.
MuesliSwap Acknowledges Lack Of “Adequate Clarity”
In a post on X (formerly Twitter), the team behind MuesliSwap admitted that it failed to provide “adequate clarity” on the slippage feature within its decentralized exchange. Users have had to pay high slippage due to the manner in which the protocol’s matchmaker was designed.
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The MuesliSwap team explained in the post:
Our decentralized matchmaker setup allowed each matchmaker to fill the limit order and choose whether to return the additional slippage amount or retain the difference at their discretion.
MuesliSwap claims this difference has served as an incentive for the matchmakers since the beginning. To further clarify, the protocol’s team said this “supplementary matchmaker incentive” pushes the decentralized matchmaker to prioritize users’ orders during periods of high market volatility. However, it acknowledged that pushing this under the unclear term “slippage” may have confused new users.
???? Clarifying Slippage on MuesliSwap: We want to address confusion about advanced matchmaker slippage on our platform. Quick heads-up: This impacts only a handful of users so please be careful about what others state on Twitter. ????
1️⃣ Trades through the MuesliSwap DEX aggregator… pic.twitter.com/SBpBZUWxnb
— MuesliSwap Team???? (@MuesliSwapTeam) August 8, 2023
In a bid to rectify the situation, the MuesliSwap team disclosed that it would be refunding users who were affected by the high slippage on the protocol’s pools in the last 12 months. The team claims that the funds for users’ reimbursement will come from the “project funds”.
Additionally, MuesliSwap said that a comprehensive analysis of all trades will be carried out to ensure fair refunds. “This process may take approximately 3 to 4 weeks as we gather and validate the necessary data, and implement the distribution code,” the team noted.
MuesliSwap To Remedy The Situation?
At the end of the post, MuesliSwap stated that swift action has been taken to fix the high slippage issue in the DEX order book.
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The team also said:
Going forward, our DEX protocol will provide clear and accurate information on slippage when interacting with our pools.
MuesliSwap is the fifth-largest protocol on the Cardano network, with a total value locked (TVL) of $10.41 million, according to data from DefiLlama.
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Author: Opeyemi Sule