# Proposal: Increase Trading Fees on the LPL pool to 5%

**URL:** <https://gov.bancor.network/t/proposal-increase-trading-fees-on-the-lpl-pool-to-5/4065>\
**Category:** DAO Archive (SUBMITTED)\
**Created:** [September 1, 2022, 2:34am UTC](https://gov.bancor.network/t/proposal-increase-trading-fees-on-the-lpl-pool-to-5/4065 "2022-09-01T02:34:20Z")\
**Posts on this page:** 2\
**Page:** 1

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**Author:** ![glenn](https://dub1.discourse-cdn.com/flex013/user_avatar/gov.bancor.network/glenn/32/1720_2.png) [@glenn](https://gov.bancor.network/u/glenn)\
**Post date:** [September 1, 2022, 2:34am UTC](https://gov.bancor.network/t/proposal-increase-trading-fees-on-the-lpl-pool-to-5/4065/1 "2022-09-01T02:34:20Z")

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### This proposal is expected to appear on Snapshot for voting on 2022-09-04T15:00:00Z. 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:

> [@Proposal: Increase Trading Fee in steps on the LPL pool from 1% to 5%](https://gov.bancor.network/t/proposal-increase-trading-fee-in-steps-on-the-lpl-pool-from-1-to-5/3892):
>
> This proposal is expected to appear on Snapshot for voting on 2022-07-31T15:00:00Z (UTC). Make sure to stake your vBNT for voting before this date and time to participate in the DAO decision. TLDR : The LPL-BNT pool is currently the deepest pool, with it beating the UNI based pool by almost x10. This basically makes us the prime provider for LPL Current swap fee is on UNI is also 1%, while having more than 10x less TVL than Bancor atm. Thus it should definitely not be strange to increase the …

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:

 ![combined_LPL_equal](https://europe1.discourse-cdn.com/flex013/uploads/bancordao/original/2X/a/ab02e5349a8228d0baf95df159e9fc290451bb36.png)

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).

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**Author:** ![foxsteven](https://avatars.discourse-cdn.com/v4/letter/f/838e76/32.png) [@foxsteven](https://gov.bancor.network/u/foxsteven)\
**Post date:** [September 1, 2022, 7:42am UTC](https://gov.bancor.network/t/proposal-increase-trading-fees-on-the-lpl-pool-to-5/4065/2 "2022-09-01T07:42:00Z")

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I support this proposal based on the results from the experiment.

Wondering if we need to test out each token or start increasing fees for tokens where almost all the liquidity is on Bancor.

ACRE, DAPP, CROWN etc.