I have a shit coin that I never stopped loss on, and then it was delisted by a major exchange, causing a significant drop. Now the loss is gone, and stop loss is no longer necessary, so I'll just record the loss.
Uniswap v2, to v3, to v4, one of the main updates is modifying transaction fees, especiallyV4version introducing a dynamic fee mechanism. After reading the dynamic feeV4hook mechanism, it can adjust transaction fees based on LP and price changes. I'm amazed at the innovation of dex.
Simply describe the innovative iteration of fees in v2\v3\v4.
V2has a fee of 0.3% for all pools, and the fee directly becomes part of the LPToken.
V3offers four fee levels: 0.01%, 0.05%, 0.3%, and 1%, and the fees are separate from PoS (the liquidity pool in v3 is called PoS, v2 is called LP token), meaning fees are not automatically reinvested into PoS.
V4theoretically provides unlimited fee options, codifying and customizing the fee collection mechanism. It can potentially use fees to regulate (encourage or suppress) trading behavior and manage Impermanent Loss in PoS.
Compared to CEX, the fee mechanism has been mature for a long time, seemingly unchanged for over a decade, focusing on user VIP levels and platform token fee coverage.
From the fee innovations on Uniswap, I have an interesting idea that CEX could also innovate on transaction fees.
Delisting a token is actually a lose-lose-lose situation, at least in the short term, with the project team, hodler users, and the exchange itself all losing money.
Would it be a better mechanism for exchanges to use different fees for different coins instead of delisting?
For example, an exchange could split a trading pair's (such as ETH/USDT) transaction fee into a base fee and a punitive fee. The base fee would be the current exchange fee policy.
The punitive fee is an innovative mechanism, defaulting to 0.
If a CEX is dissatisfied with a coin, the current approach is to issue a warning and then delist. With a punitive fee, they could impose an additional fee to penalize the token.
The punitive fee percentage would be adjustable, ranging from 0 to 10%. Haha, 100% would mean confiscation upon trading, haha.
The punitive fee could be set to be paid by sellers or buyers, or even structured like a funding rate in perpetual contracts. This can adjust incentives for buyers or sellers, with the default being retained by the exchange.
Perhaps the punitive fees collected by the exchange could be used to establish an ecosystem development fund to support the coin's development or sponsor the foundation to continue efforts. In this case, it wouldn't be called a punitive fee, but an ecosystem building fee.
Many projects currently lack development funds, or their foundations are short on money.
Historically, crypto project foundations have tried to obtain additional coins from miners to cover operational costs. Dash was the most successful, taking 10% of mining output as foundation income.LTCandBCHhave tried to use mining output to sponsor developers but failed.
Why not try to extract some money from trading users to sponsor development?
If exchanges could set a voluntary ecosystem building fee, such as for the BTC-USDT trading pair, with a default off setting where users can choose to contribute a small fee (one in ten thousand? One in hundred million?), collected to specifically sponsor Bitcoin Core developers.
Of course, this would be complicated.
Would using punitive fees on tokens be a better way to express warnings and encourage project improvements compared to outright delisting?
The biggest issue is that trading users dislike transaction friction and would move coins to exchanges with lower fees, but this still provides users with more options compared to delisting.
I feel it's feasible.
