Cardano’s decentralized exchange platform, MuesliSwap, has declared its intention to compensate users who were confused and adversely affected by its slippage feature. This announcement follows a series of high slippage incidents over the past year, leading to user dissatisfaction and a noticeable decline in the platform’s standing in the market.
In a bid to elaborate on the compensation plan, the MueliSwap team shared a Twitter post:
📢 Important Announcement! 🚀 At MuesliSwap, transparency and user education are paramount. We recognize that we fell short in providing adequate clarity on the slippage feature within the MuesliSwap Pool DEX protocol. Our decentralized matchmaker setup allowed each matchmaker to…
— MuesliSwap Team🥛 (@MuesliSwapTeam) August 7, 2023
In blockchain transactions, slippage refers to the variance in price from when a transaction is started to its completion. MuesliSwap’s unique decentralized matchmaker system permitted matchmakers to either return the extra slippage amount or retain it, a feature that was meant to incentivize them but ended up causing unforeseen losses for some users.
Recognizing the ambiguity in how this system functioned, the MuesliSwap team has initiated a refund process that is expected to take between three to four weeks. This process would retrospectively cover the previous 12 months of high slippage occurrences and would be automatically executed for the affected users through data sourced from the blockchain.
While immediate measures have been implemented to rectify the slippage issue, the response from users was mixed. Some users have also criticized the company’s prior communication and seeming disregard for their concerns.
The broader Cardano network has also grappled with slippage issues across different DEX platforms. One trader pointed out that making large trades on any Cardano DEX might result in “huge” slippage, reducing the trader’s value. This comment highlighted the common concern among users.
Despite these obstacles, MuesliSwap is actively developing a DEX aggregator to divide large trades and minimize losses stemming from slippage, a move that could significantly transform the platform. However, MuesliSwap’s market position has been affected by these recent events. As per DeFiLlama, the platform’s total value locked (TVL) is $17.3 million, but it has experienced a 27% reduction since the beginning of August and a dramatic 68% fall since reaching its peak in April 2022.
Amidst this backdrop, ADA has experienced a revival, with its price rising just above the $0.29 mark. Major investors, referred to as whales and sharks, who hold between 100,000 and 10 million ADA tokens, have been accumulating at levels not seen since September 2022. Additionally, Cardano’s on-chain transaction volume has been on a steady incline over the past six months, adding to the intrigue surrounding Cardano’s renewed momentum.
