> For the complete documentation index, see [llms.txt](https://docs.muesliswap.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.muesliswap.com/dao/matchmaker-governance-user.md).

# Matchmaker Governance User

Our DAO governance is currently available on the Cardano PreProd Network [https://preprod.dao.muesliswap.com](https://preprod.dao.muesliswap.com/)

### Motivation: Why We Need Matchmaker Governance

In many decentralized applications (DApps) on Cardano, a special type of actor called a **batcher** or **matchmaker** is responsible for collecting user transactions and submitting them to the blockchain in a single, efficient bundle. This process keeps trading and DeFi operations running smoothly — but today, most batchers are still **centralized**.

That means a small group (or even one person) controls how transactions are processed. This setup can create several risks:

* If a batcher fails or acts unfairly, the whole system can break down.
* A centralized batcher could **censor transactions** or **reorder them** for profit (a problem known as MEV — Maximal Extractable Value).
* The community has **no direct control** or visibility over who operates batchers and how they behave.

To fix this, we introduce our efforts for **matchmaker/batcher governance** — a decentralized way to manage who can operate as a batcher through **community voting and on-chain licenses**. Instead of a single operator holding power, a **DAO (Decentralized Autonomous Organization)** issues and revokes matchmaker licenses using transparent rules and token-based voting. **Please note this is currently on preproduction network ONLY.** 

This approach aims to:

* **Distribute power** among the community instead of central entities.
* **Increase transparency** by making all governance actions visible on-chain.
* **Promote fairness and accountability** through regular license renewals and performance monitoring.
* **Build trust** in DeFi protocols by aligning incentives between users, developers, and batchers.

In short, matchmaker governance is about turning an essential but centralized system component into a **community-driven, open, and auditable process** — ensuring the long-term security, fairness, and sustainability of decentralized trading on Cardano.

### Implementation on MuesliSwap

On MuesliSwap, matchmaker governance will be implemented through our new **DAO setup**. This setup connects governance, licensing, and monitoring into one transparent framework managed by the community.

To make this possible, several key components are required:

* **DAO Governance Platform:** A governance system that allows DAO members to propose, vote, and issue **DAO-controlled licenses** for matchmakers. These licenses define who is authorized to operate as a batcher within the protocol.
* **DEX Smart Contracts:** Smart contracts on the DEX must be able to **verify and enforce DAO-issued licenses**, ensuring that only approved matchmakers can process transactions.
* **Monitoring Framework:** A data and analytics layer that helps DAO members **evaluate matchmaker performance**, detect misbehavior, and make informed decisions about license renewal or revocation.

We divide matchmaker governance into two main components within the DAO interface:

1. **Matchmaker Voting**\
   A smart contract–based voting system that enables DAO members to **grant or revoke matchmaker licenses** through on-chain voting. Each vote is transparent, and every license is represented by a NFT that always has a time-limit and the matchmaker is required to renew it.
2. **Matchmaker Monitoring**\
   A visual interface that connects to our analytics backend, showing **real-time data and historical metrics** about matchmaker activity. DAO members can review transaction performance, profits, and reliability to decide whether a matchmaker should keep its license.

Together, these components form the foundation of a **community-driven governance model** for MuesliSwap. It ensures that matchmakers operate transparently, fairly, and in alignment with the DAO’s goals — building a more resilient and decentralized DeFi ecosystem on Cardano.