RadioShack Gas Fee (RADIO Token's Secondary Utility)
Most swaps have a fixed transaction fee that's constant across all liquidity pools. This ignores the obvious advantages of charging dynamic fees - that take into account the price inelasticity of rare token pairs versus the elastic common LP pair fees.
We think this is the biggest oversight of the solar system, only slightly worse than not offering valet parking services at hospital emergency rooms:
  • Some liquidity pairs are elastic commodities (example: WETH-USDC) but are needed strategically to provide an efficient swap on the Dapp. On these pairs, it's logical to reduce the transaction fee (henceforth referred to as RadioShack Gas Fee) to attract liquidity knowing that the money will be made elsewhere - on more exclusive and proprietary token swaps.
  • On more exclusive and proprietary tokens (example: any token that we bring on the platform through B2B activities) it makes sense to charge a slightly higher RadioShack Gas Fee to capture more value.
Using the same logic, the protocol's share of RadioShack Gas Fee is also variable. On commodity pairs, the protocol may take a very small or even zero-fee, leaving maximum incentive for liquidity providers while in other scenarios, the protocol might take a larger fee.
Regardless of the splits, 100% of RadioShack's share of the swap gas fee is ultimately paid in RADIO tokens (via conducting a buyback of tokens from the open market). The protocols newly received RADIO tokens (from the accumulation of RadioShack Gas Fee) will be tentatively used as follows:
  • 50% of RADIO tokens are burned to create a deflationary force. Similar to Ethereum London Fork burn mechanism, this is important to the protocol's success.
  • 10% used by PODL to add liquidity for RADIO token with various pairs (this is permanently held in RadioShack PODL).
  • 10% to Dev Fund to support development of the protocol.
  • 10% to RadioShack Corp.
  • The remainder is TBD.
Last modified 2d ago
Copy link