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The Case for Value Capture at the Periphery

  • Article
  • Jul 18, 2022
  • #Decentralization
Wilson Cusack
@WilsonCusack
(Author)
w.mirror.xyz
Read on w.mirror.xyz
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Lately I’ve been thinking about something else: extractive fees should be accrued to parties at the periphery and not to the protocol/DAO. “Extractive fee” is kind of a cynical fra... Show More

Lately I’ve been thinking about something else: extractive fees should be accrued to parties at the periphery and not to the protocol/DAO.

“Extractive fee” is kind of a cynical framing. I am referring to fees that are being taken just because they can. The protocol could work without these fees, perhaps even better, but some party wants a reward for their work.

One example would be the fees that some borrowing/lending protocols take, between what the borrower pays and what the lender receives. Another example would be trading fees, such as Uniswap could charge.

Uniswap is a very interesting example, I think. Much has been made of the “flipping the fee switch.” The DAO could set a fee, a percent of the swap fee for a given pool, that goes to the DAO.

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Jesse Walden @JesseWalden · Jan 13, 2023
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Great post. Curious, where does that leave you on tokens?
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