Read on Twitter
@MetaMask Swapping Mega-Thread.
Learn why it doesn’t work as advertised and what MetaMask is actively doing to keep out the competition to harvest fat earnings for themselves while running the users under the bus.
Are you currently using MetaMask swapping engine? Read on
Learn why it doesn’t work as advertised and what MetaMask is actively doing to keep out the competition to harvest fat earnings for themselves while running the users under the bus.
Are you currently using MetaMask swapping engine? Read on
1/14
MetaMask has solidified itself as one of the go-to non-custodial wallet options in crypto with over 1m users worldwide.
MetaMask has solidified itself as one of the go-to non-custodial wallet options in crypto with over 1m users worldwide.
2/14
1m users - An amazing number, so what comes next? Monetization. MetaMask imposes a "small" (read between the lines) service fee to help support "ongoing development."
1m users - An amazing number, so what comes next? Monetization. MetaMask imposes a "small" (read between the lines) service fee to help support "ongoing development."
3/14
Ongoing development - let's put a value on that for a second.
Ref: https://duneanalytics.com/codefi/metamask-swaps-
MetaMask has swapped just over $3b in volume since its launch in October 2020.
That's $26m in fees straight to pockets of MetaMask over a 7 months period roughly.
Ongoing development - let's put a value on that for a second.
Ref: https://duneanalytics.com/codefi/metamask-swaps-
MetaMask has swapped just over $3b in volume since its launch in October 2020.
That's $26m in fees straight to pockets of MetaMask over a 7 months period roughly.
4/14
And the trend doesn't look to be wearing off anytime soon. Don't get me wrong - there's nothing wrong with making money. But there's something wrong when you don't have your users' best interests. I'll get back to this later.
And the trend doesn't look to be wearing off anytime soon. Don't get me wrong - there's nothing wrong with making money. But there's something wrong when you don't have your users' best interests. I'll get back to this later.
5/14
If we look at the volume distribution, it's obvious who generally gets the volume from the MetaMask swapping router. The aggregators! No surprise there. Aggregators should, in theory, always be the cheapest option because they can pinpoint the best trade.
If we look at the volume distribution, it's obvious who generally gets the volume from the MetaMask swapping router. The aggregators! No surprise there. Aggregators should, in theory, always be the cheapest option because they can pinpoint the best trade.
6/14
But wait a minute. Wasn't @MetaMask, non-custodial wallets, Defi, taking control of data, privacy, forming pools, and let LPs put their capital to work in exchange for fees? We got rid of the exchange but ended up with more middlemen than we had before? Hmm...
But wait a minute. Wasn't @MetaMask, non-custodial wallets, Defi, taking control of data, privacy, forming pools, and let LPs put their capital to work in exchange for fees? We got rid of the exchange but ended up with more middlemen than we had before? Hmm...
7/14
When you're using @MetaMask, you're essentially paying 3x fees on your trades, as they have become an aggregator of aggregators.:
1. First, MetaMask development through their cut.
2. Then aggregators with their share.
3. Finally, the real innovators - the protocols.
When you're using @MetaMask, you're essentially paying 3x fees on your trades, as they have become an aggregator of aggregators.:
1. First, MetaMask development through their cut.
2. Then aggregators with their share.
3. Finally, the real innovators - the protocols.
8/14
"No worries! I'll just use MetaMask to scan and then trade with the cheapest platform directly."
Think again. At no point are @MetaMask providing transparency into your options. So you basically have to trust their judgment, that they do, in fact, found the cheapest trade.
"No worries! I'll just use MetaMask to scan and then trade with the cheapest platform directly."
Think again. At no point are @MetaMask providing transparency into your options. So you basically have to trust their judgment, that they do, in fact, found the cheapest trade.
9/14
This becomes a problem when no new options are being added to MetaMask swapping engine. Multiple rumors of hostility when platforms have requested a listing. But at least we have access to aggregators and
@paraswap (20m vol/24h)
@airswap (5m vol/24h)
@Uniswap (Never chosen)
This becomes a problem when no new options are being added to MetaMask swapping engine. Multiple rumors of hostility when platforms have requested a listing. But at least we have access to aggregators and
@paraswap (20m vol/24h)
@airswap (5m vol/24h)
@Uniswap (Never chosen)
10/14
In only 7 months, MetaMask Swaps has become the 6th largest Gas Guzzler and is continuously sucking up more swap volume for the pleasure of its select few Aggregators + its founders and developers who seem to have stumbled upon a privatized money printer in the Defi space.
In only 7 months, MetaMask Swaps has become the 6th largest Gas Guzzler and is continuously sucking up more swap volume for the pleasure of its select few Aggregators + its founders and developers who seem to have stumbled upon a privatized money printer in the Defi space.
11/14 This seems to be a rising problem that will not go away. Especially when @MetaMask fails to recommend the cheapest trades due to multiple layers of fees, failed slippage, lack of transparency, or simply because they don't consider the cheapest platforms at any given time
12/14
I have made it a habit to at least check @Bancor, @SushiSwap, and @PancakeSwap before I go ahead with a @MetaMask Swap recommendation. And usually, I save money on that habit. But to be fair - MetaMask does recommend the cheapest option from time to time.
I have made it a habit to at least check @Bancor, @SushiSwap, and @PancakeSwap before I go ahead with a @MetaMask Swap recommendation. And usually, I save money on that habit. But to be fair - MetaMask does recommend the cheapest option from time to time.
13/14
So what can you do to address this problem?
3. things:
I. Be outlet agnostic. Don't be married to your exchange or MetaMask. No single exchange has the best rates at all times, and no aggregation (at least for now) has the best recommendations at all times.
So what can you do to address this problem?
3. things:
I. Be outlet agnostic. Don't be married to your exchange or MetaMask. No single exchange has the best rates at all times, and no aggregation (at least for now) has the best recommendations at all times.
II. Don't use @MetaMask Swaps as long as they favor platforms and skew the aggregation and algorithms. Hit them where it hurts, and take your volume elsewhere. You'll likely save money doing it, as long as MetaMask has huge blindspots in their aggregation + pockets the money.
III. Attack the @MetaMask Community with your vote, and create feature requests that push MetaMask to onboard more platforms to their increasingly dominating, 1-legged aggregator or aggregators. Like this one from the @Bancor Community: https://community.metamask.io/t/integrate-bancor-into-the-swap-feature/2917
14/14
Most competitive prices for users.
Open to new platforms to help users get better prices.
Transparent aggregation
Fat earnings for MetaMask
Opague aggregation
Controlling a beginning centralized monopoly in Defi.
Think before you swap.
Most competitive prices for users. Open to new platforms to help users get better prices. Transparent aggregation Fat earnings for MetaMask Opague aggregation Controlling a beginning centralized monopoly in Defi.Think before you swap.
And retweet if you care. :-)
