0x Gov

[cross-posted in the forum for discussion https://gov.0x.org/t/temperature-check-protocol-fee-experiment/983 and in Snapshot for voting ]

Purpose Gauge community sentiment for a temporary (4-week) elimination of protocol fees to assess the impact on protocol volume

Background Reference: https://gov.0x.org/t/future-proofing-the-protocol-fee/927

A number of factors have converged over the past nine months that have significantly impacted protocol fee revenue:

1. Sharp increase in Q1 and Q2 due to high gas prices and increased volume of open orderbook (limit order) trades

2. Sharp decrease in Q3 due to lower gas prices (in particular, the explosion of Flashbots and other MEV schemes) and increased competition for open orderbook liquidity

[see chart in forum post]

Going forward as L2s start to gain traction and in the absence of some compelling event, the downward trend is likely to continue.

Hypothesis If protocol fees are eliminated (temporarily, in this case), open orderbook volume will increase. Additionally, swap volume could increase as well due to user behavior/loyalty.

The data gathered from this experiment can be used to inform a tokenomics redesign, which is top-of-mind for protocol stakeholders.

Note: We could also reduce the fee temporarily rather than eliminating it, but that would provide a weaker signal and not be as useful an experiment.

Other Factors to Consider Staking performance will be negatively impacted; however, it is already being impacted by the factors described above.

Voting Options

1. Yes (temporarily eliminate protocol fees on open orderbook trades)
2. No (keep the current fee structure)