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closedEnded 4 years ago · Snapshot (Offchain)

Change the fee in the AMP pool from 0.5% to 1%

By 0xc268...222060

For this proposal to pass, it requires a 20% quorum and 66.7% supermajority.

TLDR

This proposal seeks to increase the pool fees on the AMP/BNT pool from .5% to 1%.
The AMP pool on Bancor has the deepest liquidity in a DEX, 1.45x the liquidity of the second largest pool.
The second largest pool, AMP/USDC on Uniswap v3 has a pool fee of 1%.
An increased pool fee will help siphon more profits from arbitrageurs to the protocol and most likely not affect volume therefore increasing APYs for the LPs in the pool.

Abstract

Deepest AMP pools are:

The AMP/BNT 0.5% Bancor pool with $17,718,863 liquidity [1].

The AMP/USDC 1% Uniswap v3 pool with $12.10m liquidity [2].

The AMP/WETH 0.3% Sushiswap pool with $4,080,183.81 liquidity [3].

The AMP/ETH 0.3% Uniswap v2 pool with $6,964,529 liquidity [4].

Motivation

The second-largest pool for AMP is on Uniswap V3 and it is paired with USDC, which means LPs in the pool can incur significant IL. Fees are set to 1%.

This pool shares some similarities to the TRAC pool in which we have the largest amount of liquidity for a specific token.

An analysis on the effect of the pool fees on pool volume conducted on the USDT/BNT pool showed that there is not enough evidence to support a linear relationship between them.

Mark’s comment on the TRAC pool fee experiment sheds some light into the topic.

https://gov.bancor.network/t/proposal-trac-bnt-fee-change-schedule-and-performance-analysis/3239/2

In conclusion, increasing the pool fee will help siphon more profits from arbitrageur to the protocol, most likely not affect volume and therefore increase APYs for the LPs in the pool and protocol-earned fees.

For