Proposal to Provide Trading Discounts for Holding OOKI

Currently, Ooki Protocol does not have any form of fee discounts available for active traders and heavy users of the protocol. There is a proposal that was recently put up to introduce paying trading fees with OOKI for a discount, but this proposal entails the introduction of fee discounts for holding OOKI in the wallet that is trading. The provision of not explicitly requiring staking means that it is easy to offer this on all chains versus just Ethereum, where it is more likely to see usage and be more meaningful. Various levels of discounts could be given for the different amounts of tokens held at the time of opening the trade.

Initial proposition:
100k OOKI: 20%
1,000,000 OOKI: 25%
10,000,000 OOKI: 33.3%

Please provide any feedback on the merits of the proposal as well as any sort of feedback on the token amounts for the tiers as well as discounts applied.

4 Likes

so i intrade on arbitrum, i need to hold ooki on my arbitrum wallet to get discount? this situation is the same for the other chains? i think its good usecase to hold ooki, but what if someone borrow (or flashborrow?) ooki excecute a trade and unborrow it? isnt that infair for getting a cheap trade?

Using flash loans to acquire OOKI is definitely a way that this could be gamed but if we ultimately disable flash loans for OOKI on Ooki Protocol then it reduces the ability to acquire this type of financing. It should also be noted that to borrow 10 mln OOKI and then pay it back accrues a 0.03% fee for the flash loan (as well as increased gas costs and worse UX) so the overall savings received through this method is sub-par. As for borrowing OOKI to receive the benefits, this is something that cannot be controlled even with some sort of capital locking mechanism.

1 Like

Another thing to note is this doesn’t decrease fees immensely as even a 33.3% reduction is still at 0.1% on each side. That is in line with other sources for margin so it is not crazily cheap. We could ultimately reduce the discounts given at these tiers as well as if this is coupled with paying with OOKI, it can stack the discounts quite well. If we reduce the fee discount tiers to 10%, 15%, and 20% it should still provide some extra value but make it less extractive to attempt to game and if it is, there is still sufficient revenue capture.

great, thanks for the explanation! enable or disable flashborrow is arguable. as you explained i think disable isnt necessary since it’s having a fee and is an another service. i’ll agree on the initial proportions, it needs to be attractive. all in all i support this proposal!

The system should check with your wallet address on the chains where ooki can live. Not necessarily on Arbitrum, but it is the same address as in all the chains the platform works (EVM). This method is how Decentral Games works, it just checks the balance on other chains using your wallet address.
Btw i fully support this proposal. It should be done asap.

I agree with this proposal.

  1. It can easily be integrated as an extra in addition to the previous proposal which passed for giving trading fee discounts for PAYING with Ooki. Here it is a discount for HOLDING Ooki.

  2. It can be gamed to some extent with flash loans but there is a cost for flash loans and in general I don’t see the savings as being sufficient to really motivate people to do this much - it’s probably not worth the hassle. And if we do find people are doing it a lot, we can eliminate the program or disable flash loans or something.

  3. If technically possible it certainly makes it better if the system can give a discount on all chains even if you hold OOKI in your wallet in even one chain.

  4. Presumably this will also apply to OOKI stakers? So the discount will apply BOTH to people who hold X amount of OOKI in their wallet and people who stake X amount of OOKI?

I support this proposal!

There are technical difficulties in making it cross-chain unfortunately. If that were to occur it would likely be done through staking, but it requires some more work. If this is something that is desired, we will need to look at how to properly design this. It is also plausible to do the first iteration for where it is OOKI held in balance and a second iteration for OOKI staked on Ethereum that is usable on other chains. There will be added costs associated with staking and unstaking as it would have to update your balance state on all chains through a message sender so that is another thing to keep in mind. My initial thoughts are you can choose which chains to state your balance, but need to take some time to consider UX design

1 Like

It sounds like for the first iteration it makes sense to keep it “balance only” and then add “staked” as a feature later.

(of course all of this development should not slow down Limit Orders and PL which are the most crucial upcoming features).

2 Likes

I am supportive of the idea. I believe for big players that generate volume that will be a good discount