Representatives from the Ethereum blockchain community have introduced a new initiative regarding fees for decentralized applications (dApps). They have developed a dynamic formula that will provide higher proportional returns on investment for smaller funding amounts. This approach will allow developers to receive fair compensation for their work.
This is reported by Finway
Ethereum community members Kevin Owaki and Devansh Mehta shared details of their initiative in a post on Ethereum Research. They noted that the new fee structure aims to find a balance between incentives for developers and fairness in compensation. «We propose a sustainable fee structure that provides higher proportional rewards for smaller funding and gradually decreases it for larger amounts,» the authors of the initiative emphasized.
According to the proposal, the fee will be determined by the formula: max of (√(1000 * N), N * 0.01), where N is the funding amount. For projects with smaller funding amounts, the fee will be calculated using the square root function (√(1000 * N)), which will ensure a higher percentage fee. For example, for a pool of $170,000, this percentage will be 7%. If the amount exceeds $10 million, the fee is fixed at 1%.
Kevin Owaki and Devansh Mehta also noted: «Our goal is to provide viable incentives for developers without placing an excessive burden on users.»
It is worth noting that this proposal does not pertain to changes at the protocol level of Ethereum itself. It is focused on specific applications and may be particularly beneficial for crowdfunding platforms, public good financing, and private investments. The next steps involve testing this model on small projects, such as the new round of Gitcoin Grants, as well as experiments with capital funds.
Additionally, the initiators are discussing the possibility of redirecting part of the fees to support the infrastructure of the dApps themselves. It is important to mention that analysts from Santiment have recorded the lowest fee level on the Ethereum network in the last five years.