Fee switch date approaching, time to act | proposals.app

posted 5 years ago

I know that I'm repeating myself here and I'm sorry, but maybe the suggestion about point 3. got swamped last time:

Basic Idea: Enable UNI-holders to gain slightly higher returns on their provided liquidity. This bonus could theoretically scale with the inidividual LP's amount of UNI-tokens, though I'd highly recommend diminishing returns. With this approach LPs as well as UNI-holders would profit on the one hand while on the other hand UNI-hodlers would NOT be rewarded for idling around. The diminishing returns could be used to incentivise an increased degree of decentralisation / token-spread and thus keep some UNI-token in circulation. The said bonus-LP-gains would be funded 100% by the extra fees from enabling the fee-switch.

I know that I'm repeating myself here and I'm sorry, but maybe the suggestion about point 3. got swamped last time:

I'm no coder, but I guess it would be possible to realise this mechanism with some sort of staking of UNI-tokens. This way owners could put their UNI-token to use AND STILL be able to vote in governance (at least to my understanding). Something that - so far - did not work for UNI-token that are trapped in LPs. I see a problem with preventing UNI-whales to simply spread their UNI across several addresses and thus workaround the diminishing returns. But maybe there is a solution to this?

In summary I guess I overlooked several red-flags and drawbacks of that idea, but so far it seems to me to incentivice new and small UNI-holders as well as LP-whales (but NOT UNI-whales) and negates the problem of UNI-hodlers being rewarded for not doing or risking anything.

MaKla

posted 5 years ago

I know that I'm repeating myself here and I'm sorry, but maybe the suggestion about point 3. got swamped last time:

MaKla

posted 5 years ago

This summary would be a great and valueable contribution, not only to UniSwap but also (likely) from a research-perspective. I'm no expert in this field but I can imagine that the concept of decentralized / distributed governance opens up quite some new research areas!

I guess (and hope) this pro / con list for the fee switch will consider multiple perspectives though, in order to have a neutral baseline? :slight_smile:

About the fee-switch itself: I've got to admit that the Uni-Token having some additional financial, passive incentive was / is a (psychologically) nice thing, especially for small fish like myself (rather plancton). I do also understand the party that does reject this mechanism (why should you get money for "having stuff sitting around idle?"... well... banks seem to have an answer about this :D). In the end I'd have liked something like this: as long as you hold uni-token on an adress, all LP that same address actually provides receives a minor boost in collected fees. The more UNI you've got, the bigger that bonus (though diminishing returns should really be considered). ALL of this bonus payment can be paid from the marginally increased trading fee that is enabled after activating the fee-switch. This way both UNI-holders and LP-providers would be fine and the distribution of UNI-token should even be optimized over time (due to said diminishing returns).

I'm not saying this is the best solution as I am very likely missing LOTS of aspects, but to me - so far - it seemed fair and interesting at the same time.

MaKla

posted 5 years ago

I guess (and hope) this pro / con list for the fee switch will consider multiple perspectives though, in order to have a neutral baseline? :slight_smile:

I'm not saying this is the best solution as I am very likely missing LOTS of aspects, but to me - so far - it seemed fair and interesting at the same time.

Jorropo

posted 5 years ago

edited 5 years ago

Distributive fee switch is overated, his ~6% apy is nothing

I really think distributive fee switch maximalist over estimate the fee switch. This also applies to buyback fee switch maximalist. Let me share this tiny equation I've just made to proove my point:

Distributive fee switch is overated, his ~6% apy is nothing

I really think distributive fee switch maximalist over estimate the fee switch. This also applies to buyback fee switch maximalist. Let me share this tiny equation I've just made to proove my point:

(dailyVolume*feeTierRatio*feeSwitchRatio*numberOfDays)/(expectedUniAffectedByIt*UniPrice)

dailyVolume is the daily volume on uniswap, the goal is to extract the fees we are gonna capture from it, I'll take 1b5 as this is clearly on the upper hand of what fees uniswap have seen, this doesn't make a huge difference anyway as it only scales linearly (you would need a *20 to start see some good numbers anyway)
feeTierRatio is the fee tier used by pools, idealy you would not use the volume but the number of fees but I was too lazy to find it as this wasn't obvious to me. I'll then consider that all swaps on uniswap are made at 1% fee tier (the biggest).
feeSwitchRatio the part of that fees that are going for fee switch, I'll take 1/6 as this is the only possible value on V2.
numberOfDays is how long thoses fees acumulate, I use a plain multiplication and not proper APY as fee switch has no compounding feature, unless you manually go add them back yourself as LP (or other invesment) but this depends on case per case and complicates a lot for not a huge difference.
expectedUniAffectedByIt is the number of shares the fee switch is gonna be broken into, I'll take 564m970k520 as this is the current circulating supply of uni (according to coinmarketcap) and you can resonably expect it to be lower (as not all people would likely stake their UNI into a fee switch distributor contract)
UniPrice is the price of uni, this is used to normalise this with the volume with have on the left hand of the division (you could remove this to have a share per UNI)

Distributive fee switch

Just trying to see how much USD would be yielded over one year per UNI gives use : (1500000000*0.01/6*365)/(564970520) = 1$60, remember that I've already over estimated that likely. We can also include the current price too: (1500000000*0.01/6*365)/(564970520*27.27) we then see that per $ invested we produced 5.9 cents over 1 year (so ~6%). Fun thing then, given my estimation, how much should the price of UNI should be for the feeswitch yields to be equaly 40% apy (which was a high but still realistic target for V2), we then replace the price by x and ask to solve for x given a target of 40 cents produced per year: solve (1500000000*0.01/6*365)/(564970520*x)=0.4 for x = 4$.

I'm not saying that the price is gonna jump by 4$, nor that it's gonna lower it self at 4$. It's just that in comparision to the current price, if a distributive fee switch was enabled, the UNI price is very likely not gonna be effected much by it (it might actually crash if most people are here for the money, as if you want only money, a distributive fee switch makes no sense, sell your UNI and provide LP, use charm.fi and get way more money that way).

Buyback

To compare this to a buyback it's a bit more hard, as this is a slow steady flow of money, I can't just go input that into 1inch and say "well the price impact is xx%" as there is lots of trading on CEX such as binance too. So I'll just compare the number of money that this would generate per day to the trading volume of UNI. This is simply : dailyVolume*feeTierRatio*feeSwitchRatio as we don't try to correct for any length of time nor share between uni holders. This is 1500000000*0.01/6 = 2m5$ compare this to the ~400m of $ traded in the past 24h, and note that 400m$ is in the very low average compare to the past, if you go back 1 week we were arround 1b$.

Overestimation

Remember that this is a huge overestimation since I don't even need precise value to proove my point, the 2m5 of fee switch money is already about twice the actual fees to LP in the past day (the main part is likely that most volume is made on 0.3% and 0.05%, not 1% like I estimated).

Jorropo

posted 5 years ago

edited 5 years ago

Distributive fee switch is overated, his ~6% apy is nothing

I really think distributive fee switch maximalist over estimate the fee switch. This also applies to buyback fee switch maximalist. Let me share this tiny equation I've just made to proove my point:

Distributive fee switch is overated, his ~6% apy is nothing

I really think distributive fee switch maximalist over estimate the fee switch. This also applies to buyback fee switch maximalist. Let me share this tiny equation I've just made to proove my point:

(dailyVolume*feeTierRatio*feeSwitchRatio*numberOfDays)/(expectedUniAffectedByIt*UniPrice)

dailyVolume is the daily volume on uniswap, the goal is to extract the fees we are gonna capture from it, I'll take 1b5 as this is clearly on the upper hand of what fees uniswap have seen, this doesn't make a huge difference anyway as it only scales linearly (you would need a *20 to start see some good numbers anyway)
feeTierRatio is the fee tier used by pools, idealy you would not use the volume but the number of fees but I was too lazy to find it as this wasn't obvious to me. I'll then consider that all swaps on uniswap are made at 1% fee tier (the biggest).
feeSwitchRatio the part of that fees that are going for fee switch, I'll take 1/6 as this is the only possible value on V2.
numberOfDays is how long thoses fees acumulate, I use a plain multiplication and not proper APY as fee switch has no compounding feature, unless you manually go add them back yourself as LP (or other invesment) but this depends on case per case and complicates a lot for not a huge difference.
expectedUniAffectedByIt is the number of shares the fee switch is gonna be broken into, I'll take 564m970k520 as this is the current circulating supply of uni (according to coinmarketcap) and you can resonably expect it to be lower (as not all people would likely stake their UNI into a fee switch distributor contract)
UniPrice is the price of uni, this is used to normalise this with the volume with have on the left hand of the division (you could remove this to have a share per UNI)

Distributive fee switch

Buyback

Overestimation

Jorropo

posted 5 years ago

From what I understand this argument relly on the fact that if the governance sells UNI the price must drop.

Proposing sell pressure proposals all the time is not sustainable for the growth of Uniswap´s treasury and presents a strong threat to the UNI token project as a whole. Afterall, who wants to hold a token which basically redistributes its value to other people??

From what I understand this argument relly on the fact that if the governance sells UNI the price must drop.

Proposing sell pressure proposals all the time is not sustainable for the growth of Uniswap´s treasury and presents a strong threat to the UNI token project as a whole. Afterall, who wants to hold a token which basically redistributes its value to other people??

Some context about my main point

But there are multiple ways to go about selling lots of UNI :

Using a sell order (not a V3 based one as they are biddirectional until completion, a custom tiny fixed ratio swapping contract would be better I guess), this couldn't make the price fall by itself, this could only let it not raise.
Proposing a project that is worth more in the mind of investisors than the cost in UNI for the governance, if the governance's project makes more people think "wait shit this is cool I need to be a part of this" and then buy UNI, than the number of UNI it sells, ok the price fall (or not rise with a sell order), but it will also rise more due to the influx of new buyers.

My main point

So for me a project like an automated self rebalancing V3 position (like does charm.fi) where the profit are shared to UNI holders funded by selling UNI would rise the price more than it cost to do (because this is dope AF and this would sell the idea of high efficiency passive income on V3) and would force a bunch of people to buy UNI to take a part of the profits. The governance compete with almost no one and can just say "we are selling 25m UNI at 28$" while people that will want to jump on board will have to compete with each others to get a part of the cake.

Don't forget than governance could invest in other things too. I know some people were talking about investing in other new starting DeFi, then the governance would play an invesment funds like role.

0 sum games

The fee switch is a 0 sum action, before you have 600$ of fee going to LPs, now you have 500$ for LP and 100$ for UNI holders, a UNI buyback, ...

This achieve nothing, you just moved a bunch of numbers arround, it's only changing the wealth distribution but doesn't create any new wealth.

However if the governance use that money to provide it uniswap, it provides less price impact, will attract more transaction fees (from dex agregator such as paraswap, 1inch, 0x, ...). And thus the situation of the uniswap ecosystem is better in this state as the sum of LPs, UNI holders and governance is higher.

There are ways to generate more money, why do you want to bother with something that bother LPs and just moves stuff arround ?

Other buy pressures

Basically as long as when the governance sells UNI it uses them to create more value than the value of the UNI it sold (which is kinda like the whole point of invesment) the price of UNI can't drop just by a sell of UNI because their will be more buyers willing to buy thoses UNI. If there aren't thoses buyers that mean that the governance either messed up and is paying more money than something is worth or it isn't following profit as a target (like funding charity), at this point there is no reason to talk about making money, it's just not a goal anymore.

Corporation (which you seems to target with dividend like rewards for UNI holders) invest all the time and they are mostly going fine. I don't see why the governance couldn't attempt this.

You don't need to give money to UNI holders to create a buy pressure, you can sell them the idea of money but later.

A few sentences I feel commenting

Now, if we propose sell pressure proposals all the time with no buy pressure proposals, what is the incentive for anybody to be a willing UNI token buyer?

Because the uniswap governance would be capable to create more value with your money that you exchanged against UNI than you could doing yourself. Example with self rebalancing strategy, the bigger you are the more worthwhile this become (because gas fee become a smaller part of the total and you can rebalance more often)

The value of this treasury is determined by the price of the UNI token. This means that if there are willing UNI token buyers, the value of the treasury grows.

Distributing fees to LP is a bad way to go about it, if a higher UNI price is a target to you just do a UNI buy back with the fee switch money. Because there are 3 options with a fee switch distribution :

Markets are efficient and buyers perfectly match the value of the fee switch rewards, this is the same effect as a buyback but you wasted a lot and I mean a huge lot of gas doing a complex reward system.
Markets are inneficient buyers under evaluate the opperation, the governance loose money, it could have won more using the fee switch dirrectly.

Buy backs are way clearer and achieve the same goal on the price. It is almost impossible to under estimate the value of a buyback, because well it is there and it is happenning, this can still lead to speculative reactions but they are all good for the price, everyone would consider twice selling his coins when a buyback is announced, because you know there is a huge buy pressure on the price. (actually they could sell instant if the buyback is a fixed size and instant they could then try to be the first to arb it before others, but if it were to come from fee switch this would be a slow stream of buyback, not anything major to arb) For me there is way less chance for the buyback to be undervalued and the governance is yielding less results out of it, plus this is giving more power to the governance.

Simple path from A to B

If the whole plan of a high UNI price is so the governance will be able to make money selling his own UNI in the future, why not keep the UNI in the governance and just use the fee switch to fund the thing the governance wants to fund in the first place ? It seems to me you have a huge complicated step of fee switch into UNI holders, the creating a buy pressure on the UNI price, then selling UNI in tresury to get funds. That can just be simplified by activate fee switch, use fee switch money to fund governance's expenses. This has way less unkown, is way simpler to do and require no middle man seeking to make money.

with the timelocked code

First forks are appearing, they aren't serious yet (only about ~15k$ of TVL) but we don't know how the situation will evolve, this is something really hard to enforce on the blockchain, the OFAC isn't capable to stop IRA from using ETH as an invesment medium, I have very high doubt about wether or not they can even force shutdown a concurrent that would steal V3's code.

The second argument is also not valid because the LPs which suffer the loss of the income can simply offset it by buying UNI tokens and collect the fees to cover for the loss arising from the fee switch.

Personaly, that not a problem for me, I'm ok with LPs having less money, actually I'm for a certain type of fee switch. My problem is that your option it's 0 summed.

A better fee switch alternative ?

I think we should enable fee switch, all money would then be placed into providing liquidity on uniswap.

This acknolege the other users of uniswap no one here seems to talk about, the swappers. What swappers like : high output for their swaps. This mean low swap fees and low price impact, the first one I don't think we need to change it, the 0.05% is already one of the cheapest way on the market. But the TVL we can just provide liquidity, own by a self rebalancing contract (for V2 pretty easy, litteraly receive LP tokens, and do nothing, there is no balancing and they compound by themself, V3 need a rebalancing stuff, there is also the question of does the V2 liquidity should be moved to V3 ? (I think yes, without a doubt personnaly))

This would draw more liquidity for everyone, as a transaction from an aggregator that would go on balancer would now go on uniswap instead, but this new transaction yielded by this better price impact would be shared accross all LPs. This will compound (up to a certain market saturation, we don't know how close is uniswap to it, maybe this can push so far that uniswap is capable to propose better prices than CEX, this might result in people who don't care about decentralisation but just want to trade to use uniswap then) and have really good results in the future. It's something we can setup now, not for us, but for the governance in 1 year, 2, or even more. As we all seems to agree on it's hard to get lots of money instantly, if the governance were to sell about 25m$ of UNI instantly, spliting accross multiple DeFi this would result in 11% of price impact. But if we setup a growing supply of money, in the future when needed this question will not be, just take it from the vault.

unknown_user

posted 5 years ago

Its time to get serious.....

I want to talk about the unfairness of the governance and the sustainability of the UNI Treasury value if the fee switch does not get turned on.

Its time to get serious.....

I want to talk about the unfairness of the governance and the sustainability of the UNI Treasury value if the fee switch does not get turned on.

If we look at the submitted proposals, all of them besides one represented an attempt to dillute the value of UNI token holders and redistribute them to somebody else. Now, we have an attempt to siphon the funds for a DeFi lobby fund which represents yet another sell pressure proposal for the token.

Now, I dont know about you, but when I bought UNI token, I was buying it with the intent of deploying my capital effectively to propel the growth of Uniswap. I did not buy the token with the intent to become a piggybank for somebody else to siphon off all my value to 0. Proposing sell pressure proposals all the time is not sustainable for the growth of Uniswap´s treasury and presents a strong threat to the UNI token project as a whole. Afterall, who wants to hold a token which basically redistributes its value to other people?? Like the point of the token was it to be a governance token, but this is slowly becoming a charity type of a token where the only vote is to decide to whom we should give out money and how much....

During the community call on the 2nd of June, there were people arguing against the proposal to turn on the fee switch who are not even UNI holders. People were arguing that paying the UNI token holders does not provide value to the Uniswap project as a whole, but this is completely wrong.

Let me explain:

UNI has a treasury which holds a specific amount of UNI tokens. The value of this treasury is determined by the price of the UNI token. This means that if there are willing UNI token buyers, the value of the treasury grows. On the other hand, if there are willing sellers of the UNI token, the value of the treasury falls. Now, if we propose sell pressure proposals all the time with no buy pressure proposals, what is the incentive for anybody to be a willing UNI token buyer? Proposing dilution is clearly not a sustainable path for the token to be taking as it will diminish the buying power of the UNI treasury; therefore, there will be a limit on what it can fund.

Now, I think it would be much more beneficial for the protocol if we TURN ON the fee switch and PAY the token holders. This way we create a buy pressure proposal for the token which actively creates value in the form of a higher UNI price = more valuable UNI in the treasury = more things which we can fund in order to foster growth for Uniswap.
The main argument against the fee switch up until now was the fact the competitors would have an advantage by providing better LP fees and the fact Uniswap LPs would suffer. Now, I strongly think the situation has developed in such a way that these arguments do not hold true anymore. Uniswap V3 assured the dominance among DEXes with the timelocked code which cannot be copied over. This means that the competitors will not be able to simply adjust incentives to siphon off the liquidity of off Uniswap.

The second argument is also not valid because the LPs which suffer the loss of the income can simply offset it by buying UNI tokens and collect the fees to cover for the loss arising from the fee switch. Actually, this would be incredibly good for Uniswap as there would be a flood of willing buyers which would transfer their wealth into the treasury meaning Uniswap´s influence to propose sell proposals would increase tremendously in a sustainable fashion. Therefore, I see this as a net positive for the protocol

All in all, I do think the time to turn on the fee switch has come. With arbitrum & optimism deployment around the corner, Uniswap is in the best position to further its position as the market leader among the DEXes & enhance the value of its treasury by a good margin.

Jorropo

posted 5 years ago

From what I understand this argument relly on the fact that if the governance sells UNI the price must drop.

Proposing sell pressure proposals all the time is not sustainable for the growth of Uniswap´s treasury and presents a strong threat to the UNI token project as a whole. Afterall, who wants to hold a token which basically redistributes its value to other people??

From what I understand this argument relly on the fact that if the governance sells UNI the price must drop.

Proposing sell pressure proposals all the time is not sustainable for the growth of Uniswap´s treasury and presents a strong threat to the UNI token project as a whole. Afterall, who wants to hold a token which basically redistributes its value to other people??

Some context about my main point

But there are multiple ways to go about selling lots of UNI :

Using a sell order (not a V3 based one as they are biddirectional until completion, a custom tiny fixed ratio swapping contract would be better I guess), this couldn't make the price fall by itself, this could only let it not raise.
Proposing a project that is worth more in the mind of investisors than the cost in UNI for the governance, if the governance's project makes more people think "wait shit this is cool I need to be a part of this" and then buy UNI, than the number of UNI it sells, ok the price fall (or not rise with a sell order), but it will also rise more due to the influx of new buyers.

My main point

Don't forget than governance could invest in other things too. I know some people were talking about investing in other new starting DeFi, then the governance would play an invesment funds like role.

0 sum games

The fee switch is a 0 sum action, before you have 600$ of fee going to LPs, now you have 500$ for LP and 100$ for UNI holders, a UNI buyback, ...

This achieve nothing, you just moved a bunch of numbers arround, it's only changing the wealth distribution but doesn't create any new wealth.

There are ways to generate more money, why do you want to bother with something that bother LPs and just moves stuff arround ?

Other buy pressures

Corporation (which you seems to target with dividend like rewards for UNI holders) invest all the time and they are mostly going fine. I don't see why the governance couldn't attempt this.

You don't need to give money to UNI holders to create a buy pressure, you can sell them the idea of money but later.

A few sentences I feel commenting

Now, if we propose sell pressure proposals all the time with no buy pressure proposals, what is the incentive for anybody to be a willing UNI token buyer?

The value of this treasury is determined by the price of the UNI token. This means that if there are willing UNI token buyers, the value of the treasury grows.

Markets are efficient and buyers perfectly match the value of the fee switch rewards, this is the same effect as a buyback but you wasted a lot and I mean a huge lot of gas doing a complex reward system.
Markets are inneficient buyers under evaluate the opperation, the governance loose money, it could have won more using the fee switch dirrectly.

Simple path from A to B

with the timelocked code

The second argument is also not valid because the LPs which suffer the loss of the income can simply offset it by buying UNI tokens and collect the fees to cover for the loss arising from the fee switch.

Personaly, that not a problem for me, I'm ok with LPs having less money, actually I'm for a certain type of fee switch. My problem is that your option it's 0 summed.

A better fee switch alternative ?

I think we should enable fee switch, all money would then be placed into providing liquidity on uniswap.

unknown_user

posted 5 years ago

Its time to get serious.....

I want to talk about the unfairness of the governance and the sustainability of the UNI Treasury value if the fee switch does not get turned on.

Its time to get serious.....

I want to talk about the unfairness of the governance and the sustainability of the UNI Treasury value if the fee switch does not get turned on.

If we look at the submitted proposals, all of them besides one represented an attempt to dillute the value of UNI token holders and redistribute them to somebody else. Now, we have an attempt to siphon the funds for a DeFi lobby fund which represents yet another sell pressure proposal for the token.

During the community call on the 2nd of June, there were people arguing against the proposal to turn on the fee switch who are not even UNI holders. People were arguing that paying the UNI token holders does not provide value to the Uniswap project as a whole, but this is completely wrong.

Let me explain:

Now, I think it would be much more beneficial for the protocol if we TURN ON the fee switch and PAY the token holders. This way we create a buy pressure proposal for the token which actively creates value in the form of a higher UNI price = more valuable UNI in the treasury = more things which we can fund in order to foster growth for Uniswap.
The main argument against the fee switch up until now was the fact the competitors would have an advantage by providing better LP fees and the fact Uniswap LPs would suffer. Now, I strongly think the situation has developed in such a way that these arguments do not hold true anymore. Uniswap V3 assured the dominance among DEXes with the timelocked code which cannot be copied over. This means that the competitors will not be able to simply adjust incentives to siphon off the liquidity of off Uniswap.

First of all, I'm super happy that a delegate with a sizeable amount of delegated votes comes here and actually discusses the proposals with us smaller holders/non delegates. It's not something that happens a lot. Big delegates have been mostly absent and as a result, governance has been pretty much dead. I think this is changing, and I'm really happy. We are hearing that community managers are being hired. As a sidenote I think we need more active moderation here. More precisely we need to delete threads about future airdrops as they are really counterproductive and encourage scammers preying on gullible users. We should have a big banner saying there are no more airdrops planned.

Back on topic : I think we agree that our goal should be to have our LPs transition to v3, just like they transitioned to v2 about a year ago. V2 is the new V1 if you will. The transition should/will happen ; it's a matter of time essentially, insofar as V3 is a superior product and that it makes V2 (along with protocols who copy-pasted the code) obsolete.

So turning on the fee switch maybe a couple of weeks (the timeframe is what should be debated here in my view) after V3 goes live on L1 (Ethereum mainnet) could help us give a wake up call to LPs who still haven't transitioned. But mostly -- at least in my view -- it would be a strong symbolic action for governance to take at this point. Because it will also serve as a huge reminder that UNI holders can come together and take a collective decision on a fee switch proposal. In this way, the DeFi community can be reminded that UNI isn't just a pure governance token : one of its main purposes is to act as a stake in future protocol fees.

V2 fee switch also is a very nice compromise/middleground between no fee-switch at all and v3 fee switch.

In any event I don't see the turning on of the v2 fee switch as having any bad consequences. The reason for that is that v2 will be a "legacy" product very soon and the volume should naturally drop sharply once v3 goes live (same as when v2 was launched, really).

There are many advantages to a v2 fee switch turn-on proposal but one of them is that the code is extremely easy. As far as I know, it's a one-liner.

I think one of the next step to envision is to come up with a full proposal and maybe post it on snapshot as an informal temperature check.

But first we really need to debate this idea a bit more (especially the timeframe) and find additional delegates who would be willing to support this proposal.

V2 fee switch also is a very nice compromise/middleground between no fee-switch at all and v3 fee switch.

There are many advantages to a v2 fee switch turn-on proposal but one of them is that the code is extremely easy. As far as I know, it's a one-liner.

I think one of the next step to envision is to come up with a full proposal and maybe post it on snapshot as an informal temperature check.

But first we really need to debate this idea a bit more (especially the timeframe) and find additional delegates who would be willing to support this proposal.

HarvardLawBFI

1.9K TOKEN

posted 5 years ago

edited 5 years ago

Glad to see great discussions that have been taking place related to the fee switch! We'd love to get more insight from the community related to the following questions:

Which liquidity pools in v2 should be turned on? The idea of turning on the switch for three different pools that reflect the three fee tiers that exist in v3 seems like it might provide valuable data points in the event we decide to turn on the fee switch in v3.
In the event we do turn it on, should we turn it on completely (.05%, which is a 16% decrease in LP's income) or should we do something smaller to hypotest the sensitivity LP's have to a fee switch? For example, V3 allows the fee switch to be as small as .03% (a 10% decrease in income), and starting at 10% for v2 might provide insightful data for us to refer to later.
What is the best mechanism to reward UNI holders after turning the switch on? Burning tokens, buybacks, or consolidating all switch fees and converting to ETH/DAI/etc? There may be different tax consequences to each approach, so that is very important to consider here.

Glad to see great discussions that have been taking place related to the fee switch! We'd love to get more insight from the community related to the following questions:

Which liquidity pools in v2 should be turned on? The idea of turning on the switch for three different pools that reflect the three fee tiers that exist in v3 seems like it might provide valuable data points in the event we decide to turn on the fee switch in v3.
In the event we do turn it on, should we turn it on completely (.05%, which is a 16% decrease in LP's income) or should we do something smaller to hypotest the sensitivity LP's have to a fee switch? For example, V3 allows the fee switch to be as small as .03% (a 10% decrease in income), and starting at 10% for v2 might provide insightful data for us to refer to later.
What is the best mechanism to reward UNI holders after turning the switch on? Burning tokens, buybacks, or consolidating all switch fees and converting to ETH/DAI/etc? There may be different tax consequences to each approach, so that is very important to consider here.

Additionally, it'd be incredibly useful to hear from anyone who strongly believes we shouldn't turn on the fee switch in V2.

HarvardLawBFI

1.9K TOKEN

posted 5 years ago

edited 5 years ago

Glad to see great discussions that have been taking place related to the fee switch! We'd love to get more insight from the community related to the following questions:

Which liquidity pools in v2 should be turned on? The idea of turning on the switch for three different pools that reflect the three fee tiers that exist in v3 seems like it might provide valuable data points in the event we decide to turn on the fee switch in v3.
In the event we do turn it on, should we turn it on completely (.05%, which is a 16% decrease in LP's income) or should we do something smaller to hypotest the sensitivity LP's have to a fee switch? For example, V3 allows the fee switch to be as small as .03% (a 10% decrease in income), and starting at 10% for v2 might provide insightful data for us to refer to later.
What is the best mechanism to reward UNI holders after turning the switch on? Burning tokens, buybacks, or consolidating all switch fees and converting to ETH/DAI/etc? There may be different tax consequences to each approach, so that is very important to consider here.

Glad to see great discussions that have been taking place related to the fee switch! We'd love to get more insight from the community related to the following questions:

Which liquidity pools in v2 should be turned on? The idea of turning on the switch for three different pools that reflect the three fee tiers that exist in v3 seems like it might provide valuable data points in the event we decide to turn on the fee switch in v3.
In the event we do turn it on, should we turn it on completely (.05%, which is a 16% decrease in LP's income) or should we do something smaller to hypotest the sensitivity LP's have to a fee switch? For example, V3 allows the fee switch to be as small as .03% (a 10% decrease in income), and starting at 10% for v2 might provide insightful data for us to refer to later.
What is the best mechanism to reward UNI holders after turning the switch on? Burning tokens, buybacks, or consolidating all switch fees and converting to ETH/DAI/etc? There may be different tax consequences to each approach, so that is very important to consider here.

Additionally, it'd be incredibly useful to hear from anyone who strongly believes we shouldn't turn on the fee switch in V2.