The cuspy halo problem is one that arises from cosmological simulations that seem to indicate cold dark matter would form cuspy distributions in the most dense areas of the universe. This would imply that the center of our galaxy, for example, should exhibit a higher dark matter density than other areas. However, it seems rather that there is likely no cusp in the dark matter distribution at all at the center of these galaxies.
This is not an intractable problem, however, because the relationships between the baryonic matter's distribution and the dark matter's distribution in areas of high baryonic matter concentration have not been adequately explored. In particular, a high density of baryonic matter would have a different distribution due to the effects of forces other than gravity. The distribution of baryonic matter, in turn, might affect the "cuspy" nature of the density profile for dark matter.
