CoW Protocol batches trades and auctions them between public and private liquidity sources. It aims to achieve better prices than other exchanges by matching trades via Coincidences of Wants (CoWs) and protecting from MEV.

CoW Protocol is a meta-DEX aggregation protocol that acts as a batch settlement layer on top of all other AMMs & DEX aggregators. CoW Protocol is a spin off from Gnosis DAO that launched in February 2021.

COW tokenholders own and govern the protocol. They currently take a cut of the total trading fees paid by traders (revenue).

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CoW Protocol

# CoW Protocol Average trading volume (per trade) Methodology

## 1. Overview

Average trading volume (per trade) measures the average value of a single trade executed on CoW Protocol. This metric is calculated by dividing the total daily trading volume by the daily trade count. It serves as an indicator of whether the protocol is primarily utilized by institutional participants, characterized by higher average trade sizes, or retail users, who typically execute smaller transactions.

## 2. Data sources

- **Blockchain events**: `Trade` events from `GPv2Settlement` contracts, as well as `OrderPlacement` events and `createOrder` function calls from `CoWSwapEthFlow` contracts, covering Ethereum, Arbitrum, Avalanche, Base, and 5 other chains
- **External data**: End-of-day price feeds and asset metadata

## 3. Step-by-step calculation

### Component A: Trade extraction and identification

- **Purpose**: Identify and extract individual swap records from the blockchain
- **Logic**: `Trade` events are parsed from `GPv2Settlement` contracts. Each trade is identified by a unique order identifier. Trading accounts (senders) are mapped by joining these trade events with `OrderPlacement` events and `createOrder` function calls from `CoWSwapEthFlow` contracts using the transaction hash and order identification strings. Transactions involving specific denylisted assets are excluded from the dataset.
- **Key fields**: `orderUid`, `sellToken`, `buyToken`, `sellAmount`, `buyAmount`, and `sender`

### Component B: Trading volume calculation and USD normalization

- **Purpose**: Determine the USD value of daily trade activity
- **Logic**: Trade amounts for both the sell-side and buy-side assets are normalized by asset-specific decimal precision. Native gas assets are identified and mapped to their respective wrapped asset equivalents. To mitigate the impact of price manipulation or outliers, the total trading volume for each transaction is calculated by taking the lower USD value between the sell-side and buy-side legs, using end-of-day price feeds. These values are then aggregated to determine total daily trading volume.
- **Key fields**: `token0_amount`, `token1_amount`, and `price_usd`

### Component C: Trade count calculation

- **Purpose**: Determine the total number of unique trades executed per day
- **Logic**: The daily trade count is calculated by performing a distinct count of the unique order identifiers extracted from the settlement contracts. This ensures that multi-legged settlements or complex transaction structures are correctly attributed to the individual intent-based orders they fulfill.
- **Key fields**: `order_uid`

### Component D: Average trade value calculation

- **Purpose**: Generate the final average metric
- **Logic**: The total daily trading volume (Component B) is divided by the distinct daily trade count (Component C). The resulting value represents the average USD value per trade for a given period. Daily granularity is maintained using UTC day boundaries, and values are zero-filled for days with no recorded activity.
- **Key fields**: `trading_volume`, `trade_count`

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

CoW ProtocolCOW

Average trading volume (per trade)

Average trading volume (per trade)

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