Bancor

This proposal is expected to appear on Snapshot for voting on Today 4:00 PM . Make sure to stake your vBNT for voting before this date and time to participate in the DAO decision.

For: Set the LPL pool fee to 5% on v2.1 and v3 Against: Leave the LPL pool fee to 1% on both v2.1 and v3

This is a follow up proposal to the LPL fee change experiment: https://gov.bancor.network/t/proposal-increase-trading-fee-in-steps-on-the-lpl-pool-from-1-to-5/3892

in which an experiment was performed on the Bancor LPL pool to find which fee value was the most profitable for the protocol.

The results found that a 5% fee on this pool yielded the highest amount of daily fees on average:

in which an experiment was performed on the Bancor LPL pool to find which fee value was the most profitable for the protocol.

The results found that a 5% fee on this pool yielded the highest amount of daily fees on average:

This proposal is therefore seeking to make this change permanent and set the fee on the LPL pool to 5% on both v2.1 and v3. If this proposal passes, we can gather some results at the 30 day mark to see how 5% over the course of 30 days compared to 1% over the course of 30 days (we have this data).

The LPL pool on Bancor is unique since there is little to no liquidity on any other DEXes and therefore we have a moat. We have other tokens such as TRAC and ARCONA which have performed well on Bancor with high fees since we are the sole liquidity provider. It is therefore advantageous for us to charge a premium on swapping these tokens.

This might bode well for the long tail thesis which loosely states that the majority of long tail tokens tend to make up the largest majority of fee generation (or at least surpass those of the blue chip tokens combine).