Decreasing minting fees to 0.15%

[Joel]

I agree. We need to know first what is it that truly drives volume based on where the renBTC is going and the yields they’re producing as well as the wBTC alternatives. Is there really no way to do this? There is an optimal fee to be set but the method we’re going about it is so unscientific. We’re just doing something because it seems to make sense and hoping for the best.

Next epoch if we lower fees and BadgerDao goes live with their integration, we will see a volume increase and we would have attributed it to the mint fee versus the real reason which is Badger integration. The data will become contaminated and untrustworthy.

[ep1110]

If we are looking for a period of calm and stability, without changes on the platforms or abroad, then we will have to make a decision after:

-Badger dao
-Solana
-Greycore
-Polkadot
-Acala
-Mainnet

Mix those ingredients with the volatility spoon of Bitcoin, and if we are talking about any methodological research attempt, the decision could not be made at any time this year at least.

Among the few certainties we have in the long term, two are:

1- If we consider that the future of the platform is in integrations with renVM, we should already assign that portion (0.10% e.g.) to the integrator without generating total commissions greater than the market average.

2- when two technological models offer the same solution with the same security, the difference will be in costs. Why not “take” the market in advance, combining Lowest costs with Security, Easy user experience and (future) descentralization.

Think long term, think towards network effect.

[Joel]

The only major integration that can mess up the data on what the optimal mint fee is the BadgerDao incentive program coming online. The impact of new chains on volume falls into a different category. The new chains will be online at 0.1% anyway. And based on the miniscule volume we’ve seen from BSC, it really is all about yield opportunities. I can just imagine if we had gone online with 0.25% fee for BSC, folks would be complaining that the fee was set too high and lowering to 0.1% will spur volume. Clearly, that would have done squat.

[ep1110]

The experiment was started in order to measure the elasticity of demand.
The decision to increase the fees again to 0.25% was made by the success in the lowering the TVL with the previous increase to 0.20%. And in those terms it continued to be “successful.” The cause of this measurement in the demand will not exist (increase the security of the network by lowering the TVL).

My proposal is (in a context in which it is not going to be possible to reliably obtain any data that allows a projection), use the same logic in reverse, and focus on values ​​that in the medium-long term will be unavoidable ( with the competitive advantage that means getting ahead).

About the integrations, I was not clear that I was referring to those that add fees in the operation (as someone said with renVM as a silent partner), where I think the success of the network will be sealed.

[DeFi_Whiskey]

I understand your logic, I’m certainly not against experimentation, and in fact agree now is the time to do that! My only concern is understanding the methodology we are using to “measure the elasticity of demand.” Specifically, how major events like Badger Bridge going live, a sudden increase or decrease in the price of BTC, prolonged BTC volatility, prolonged BTC stability, etc. impact how we will ultimately measure elasticity. How are we going to differentiate between price impacting volume and all these other factors?

Worse than not yet understanding price elasticity would be drawing the wrong conclusions about price elasticity. But I’m not a micro-economist, so perhaps it’s possible to draw some credible conclusions here, I’m just a bit skeptical.

[Rentard]

The Badger bridge is due to launch by the end of the week, and the next epoch doesn’t start for 19 days. So we should have a good 2 weeks of data to assess whether the badger bridge is having a material impact on volume.

I would suggest then that if revenue per darknode has not been materially impacted by the launch of the Bridge, and is still on course to do no better than 0.0175 btc per darknode this epoch, then we should reduce fees for next epoch.

The previous 5 epochs or so have accrued c. 0.015 - 0.017 btc per node per epoch, so that would be the comparison to our new levels of volume and income.

[akram01127]

I agree to reduce the mint fee to %0.1 as a limited-time offer to test the impact. It should be an immediate action before Badger bridge goes live in order to give better opportunities for the newcomers.

No need to wait for more integrations, new chains, and the greycore because it is very clear from now that renBTC supply only decreasing while others like hBTC and wBTC supply only increasing.

Reducing the fee to %0.1 will show us the best vol we could make.

Edit: Since RenVM is in production now without greycore, Solana…etc then we should work on increasing our income now as well. Reducing mint fees becomes a critical action to protect our investments.

Edit 2: Monthly network income in BTC not increasing since the launch of the mainnet. the team should consider this urgently.

[akram01127]

I don’t think that Badger bridge will bring much vol to RenVM because they charge an extra %0.25 for mint and an extra %0.4 for the burn. end-user should pay 0.5% for mint + 0.5% for burn which is too much.

[ep1110]

Assuming that it is unlikely to reach a vote prior to the beginning of the integration with Badger, I would be in favor of (as Rentard says) observing the behavior of the network for a short period and opposing a vote by the end of the epoch.

about directing us to 0.10%, agree wirh you. The problem is the feasibility of a RIP proposal, let alone a favorable vote. That is why I think that the surest path towards that objective is to previously anchor on an Intermediate scale and see.

In general order, I fully agree not to sit still waiting for an uncertain moment to evaluate the impact of the decisions but to use the same old logic of 20-10 but in a reverse sense taking into account the immediate consequences of its application (graphs).

[akram01127]

The main question is TVL still should be aligned with TVB? @loong
if yes, I think the RenVM project will be very limited and can not scale.
The current mint fee is %0.25 and renBTC supply decreasing more and more while TVL is still 3x TVB.
are we waiting for TVB to be 3x TVL as mentioned on the fee documentation page?

Current TVB is around $200M it means our target that current TVL should be $60M (1034 BTC) is that our target? it will be funny.

I don’t know Why we are building and looking for integrations, partners, and new chains while we have limited TVL?

What about Asylo solution? if this implementation will fix TVL aligned with TVB issue eventually. Why not back to 0.1% mint fee from now? in this case, the fee should be fixed at 0.1% mint and 0.1% burn. no need to change it anymore in the future don’t confuse developers, traders, users by changing the fee many times.

[Rentard]

The TVL /TVB question should be solved by Asylo, so that should no longer be the driver for us to have higher mint fees and lower burn fees. The fee structure now should have only one incentive - driving the growth of the RenVM ecosystem.

The primary ways this can be done is by increasing the liquidity of Renbtc, which we can have an impact on by agreeing to lower mint fees.

Additionally we should also be focusing on increasing revenue for node holders. I would say that given income has remained stagnant for the past 5 epochs, and the highest earning epoch occurred with much lower fees - then I would suggest this objective too could be achieved by lowering mint fees.

Obviously there are a number of external factors which will drive volume - but I’m just focusing on what we, the community and Ren team, can impact in the short term.

[MaxRoszko]

If we are to change the fees, I would at least wait until a significant period after something major occurs, like the Badger Bridge which will incentivize $5B worth of BTC minting. Changing the fee right at the same that as that will be very confusing when it comes to analysing the effect of that change.

[akram01127]

I disagree with you.
Can you make a poll and give a chance to the community to speak?

I disagree because you are relying on a third-party incentivize campaign which will not last forever and it could be canceled/delayed/failed or Whatever they do is not a big interest for us when it comes to deciding something for our project’s future.

In the badger case, I see that .5% for mint + .5% for the burn is something crazy, I have no idea How much user will earn after minting renBTC in badger but I believe that badger is just going to incentive users mainly from renVM badger extra fee that is already collected form the users which is something I consider as Ponzi.

We should take the right decision for our network fee and then let the integrators do Whatever they want and then in case if the integrator fails to bring vol it is their problem, not the RenVM problem.

RenVM is the main platform, integrators/developers/users/traders build their Dapp/trades based on RenVM structure that includes RenVM mint and burn fee percentage.
What is happening now is we are building RenVM based on integrators/developers/users/traders behaviors and market situation which is not good and could finally bring serious problems to our project.
at least users will not be confident when considering use RenVM because the fee is not stable and this could damage their Dapp or trading robot at any time.

Time is the key, users/developers prefer to use/support the most used BTC version in ethereum regardless if it is centralized or decentralized.
since wBTC and hBTC supply is increasing while renBTC supply is decreasing more and more, we are losing a significate number of users/developers at this time. that is Why I strongly support decreasing the mint fee to .1% from the next epoch and this should be the base fee at least for the next 3 years

[Zeta_Tauri]

Instead of lowering fees, I suggest that we should be incentivising specific pools with liquidity mining rewards (e.g. BSC pools) from RFC-000-016 (Community Ecosystem Fund).

I believe this will create visibility to attract people to shift liquidity from Ethereum to BSC, increasing the mints through RenVM with the added benefit of users becoming more familiar with the advantages of the bridge.

This approach is tried and proven to work with so many protocols, and I believe would be a net gain for the protocol (and it isn’t paid out with protocol inflation). People (myself included) aren’t bothered about paying 0.25% or 0.15% when I’m moving liquidity to earn 50% somewhere.

[suzuki]

I would agree with decreasing the fee to0.1％ as a node owner. Of course it is not the almighty measure to expand Ren, but it would be one of the solution to it. We should take all the measurement to take the market. User first, it’s universal axiom. node owners should take lastly. Let me take the remained pie at the last after being the bigger.

Believe it or not, reducing the fees will increase Ren’s following. I became an owner to live in an unbelievable world. An incredible world is a world without the tyranny of the few. It is a decentralized world, and that is the principle of cryptocurrency.

The cryptocurrency world is an ambitious attempt to create a different world, a world where we don’t need central banks and big banks. I believe that Ren will be supported by people who share this worldview. I think such a world is beautiful, and I think it’s the way it should be.

We have to understand that the discussions and decisions in this forum are seen by many people, affect many people, and are a signal to the market. This decision is not just about commission rates, it is about the world view that the Ren project is portraying. The effect of the signal goes beyond the economic effect of the numbers themselves. Politicians in my country have raised the consumption tax rate many times in order to raise tax revenue, but each time they have actually ended up lowering the tax revenue. Even a mere 1% increase in the tax rate can have a negative impact on the economy of more than 10%. Officials disparage people’s behavior as irrational, but it seems to me that they are not seeing the reality that they need to face.

Lowering the fees is welcomed because of its affinity to the cryptocurrency world, while keeping the fees will be perceived as a project that is thinking of the traditional economic world.

I live in a small town in Japan and wonder if it is possible to live outside the Japanese yen, tax and pension system. Iwant to live in a world that is not a centralized economy, and I hope I can contribute to making that happen. At this point, I believe that the Ren project will fulfill these wishes of mine.

I don’t need a Mercedes-Benz, I don’t need a cruiser, I don’t have a hobby of traveling abroad without a purpose. I don’t need a big house. My house I can clean myself is enough, a garden and a field that I can take care of is enough. I just don’t like bureaucracies, such as government offices and large corporations, which I don’t understand, or in other words, centralized power. I dream of a world where I can live off of Bitcoin, and I wish there was a new form of finance.

Long story short, the number of people who support Ren will increase the more fees are reduced, including owners and others. Decisions can always be changed, mistakes can always be recovered from. Ren should be beautiful, and by beautiful, I mean in line with the principles of cryptocurrency. It means that it is in line with the idea of the Internet.

In the early days of the cryptocurrency world, I hope to be the person who runs the canals and waterways for the community. I don’t want to be an apartment manager who wish the more rental income. I want to be a pioneer with the Ren project. The benefits of being a pioneer may not be so great. I am not becoming an owner to secure a concession. This is very disappointing if becoming an owner is not a linear way to realize the cryptocurrency world. There are many other crypto projects that are attractive to money handlers. I am attracted to the moderate and decent Renproject because it is consistent with cryptocurrency principles. Those who are attracted by the financial appeal will go for projects that appeal to the financially, while those who are attracted by the consistency with the cryptocurrency philosophy will go for projects that are consistent with the cryptocurrency philosophy.

[ep1110]

I have a similar vision from the other side of the world and from an economy diametrically opposed to the Japanese (intoxicated by inflation and far from excess savings).

Cmpletely agree that sooner or later we are going to the initial values ​​and with which the operation of the network was devised. And the network will be successful (and profitable as a consequence) with a comprehensive combination of high technology, security, nice user experience and low costs.

As I said before, I would be in favor of a direct reduction to .10% but I doubt the viability of the proposal in the short term.

In short, I adhere to the reasonableness of Rentard and Max to allow time (not long) to monitor the impact of the Badger integration, and depending on it, orient the proposal to 0.15% or 0.10%

[akram01127]

I believe that only low-quality projects offer such incentivizing campaigns.
RenVM is a very strong project that gives power to the developers to build something new in the crypto space and then they do such incentivizing campaigns for their own Dapps.

In the crypto space, If you have a strong project or if you write a good code, no need to spend even $1 in marketing. Bitcoin, Ethereum, and Uniswap are the best example. the project/code will enforce people to use it because they need it which I consider it the real success not because of the incentivizing campaigns for a limited time which I consider as a fake suceess.

I supported the community fund proposal only for our own developer salaries to build tools for RenVM or some type of campaigns like developer hackathon and so on.

The point is When anyone considering build on RenVM will know that the fee structure is not stable and not easy to understand (Based on official ren documentation).

We are always wanting more integrations and new partnerships while they should who wanting to use RenVM because of our features which include the low mint/burn fees.

let us make it easy, fixed, and low. in that case I’m sure a lot of new use-cases will be built without our knowledge. someone could build a cash generation app build on RenVM but keeping it secret for his own.
Even the current RenVM users using curve.fi earning yield will earn a higher income, this will help our user base to maintain and increase.

Even the Dapp operator who adds an extra fee for mint/burn like MEW will earn a higher income, this will help the Dapp operator to maintain the support. Sad to say that if the current situation continues MEW could eventually remove the RenVM support from their wallet if there is no income or if it becomes a useless feature. that is Why I’m saying time is very important.

I strongly believe that the fee structure is the main factor of our project trend at the moment. The only way to push it up is to reduce the mint fee to 0.1% NOT more.

[shiny]

Thank you for expressing your point of view and sharing your passion.

It is an attractive thought, to envision RenVM more as a pure service to the greater crypto community rather than a business for node runner profit. The end game would still be darknodes worth an incredible amount of money, but instead of a premium service it would be more akin to a public service with minimal fees to encourage mass adoption and stimulation of the entire system. I like it and am interested in testing a reduction to even .1% as stated to stimulate use cases and awareness. TVL will rise sharply, but hopefully with cheap on/off ramps users would be encouraged to exit and re-enter at will rather than park to avoid the high re-entry fees. Would love to see the bot go brrr with massive activity.

With Asylo and the decreased need for a certain TVL/TVB ratio, this could be an easier goal.

That being said, I am no economic expert so can’t understand how this would affect node profit, Ren token cost, and therefor amount of registered nodes. A sharp rise in volume but with also a decline in fee revenue could cause problems? As always welcome further discussion.

[akram01127]

Let us assume that the badger bridge campaign got successful and RenVM vol increased this epoch which I really hope.

But What is the size of volume we will consider as good, medium, or bad?
What is the required time to test the impact? and When we will change the fee or decide not to change?
In which case we will reduce the fees to what fees exactly? 0.1%? or 0.15%? or more?
Should we need to wait more time because there is another new coming big integration?

Do you think that we should consider, discuss, think, and analyze all of this in the future?

Why we don’t reduce the fee from now because this is better in all situations nowadays and in the future let our users earn even more by reducing our mint fee, let them like renAssets. Even if the next 1 or 2 epoch network income will decrease (unlikely) no problem, part of our income moved to our user’s pockets, this is a hidden good long-term investment.

Kindly reconsider the priority of reducing the mining fee

I even disagree to reduce the fee to a specific percentage to test the impact again.
reducing the fee should be a final decision that works with all situations for the long term to avoid confusing all parties and keep our project stable. I believe that 0.1% is the suitable percentage in this case.

When the fees back to the original (originally determined by the ren team) which is 0.1% for mint and 0.1% for burn, then we can work on increasing our ecosystem with more confidence.

[ep1110]

It is the set of reasons why I am inclined to think that sooner or later the market will direct (kick) us to origin values. Perhaps this cycle of self-printed fireworks (inflationary yield farming) takes away our long-term perspective and only makes us worry about the income related to the volume generated in this context. It is easy to think that there is no economic damage with high fees when returns can exceed 25%, but the real Big Bang in DeFi from my point of view will be with minimization of costs and at the time it is developed in the large platforms of lending (Aave, compound) the double flow

-Real State mortgages and tokenised assets used to finance the purchase of crypto assets.

-Borrow against BTC (long term holds) and cash out to real world or finance new purchases.

Despite being long-term moves, the cross-flow will surely be so large that even the highest volume day we’ve had at RenVM so far will look ridiculous.

So yes. Users first, grow in volume and tvl, and realize that the next generation of node operators (more investment, more sophisticated investor) are not going to look short term income but GROWING VOLUME.