This mechanism allows for direct matching of user orders without the need for traditional market makers or liquidity pools. When both parties want to exchange the assets they require, the transaction can be executed directly, avoiding intermediary fees. For portions that cannot be matched directly, CoW Swap routes the remaining orders to decentralized exchanges (DEX) or other aggregators to obtain liquidity. This design minimizes slippage and transaction fees to the greatest extent and ensures that all trades executed in the same batch share the same clearing price, eliminating price unfairness caused by the order of execution.

In addition, CoW Swap introduces a Solver bidding mechanism: multiple third-party solvers compete to provide the best trade execution plan for users, and the winner gains the right to execute that batch of trades and bear the on-chain gas costs. Users only need to sign their order intention offline and do not need to pay on-chain transaction fees themselves, and no costs are incurred if the transaction does not occur. This 'intention matching + solver bidding' model makes the user experience more friendly (without worrying about gas losses from failed transactions) and provides a certain degree of MEV (maximal extractable value) protection — since order matching occurs off-chain, solvers must bid to return MEV to users, making MEV attacks such as front-running difficult to succeed.

CoW Swap is currently available on Ethereum, Arbitrum, Gnosis, and Base.