[bisq-network/proposals] Change fee model to a more simple one? (#31)

[vycoreb]

I am re-proposing that we should, like most exchanges, have a fixed percentage fee for the taker (the one taking an offer) and one for the maker (the one who makes an offer and waits for it to be taken).

One reason is that it is a lot easier to understand. Another is that with the current formula the makers end up paying more than the takers. That is not what you want because to have an exchange that works well you need liquidity. You get liquidity by making it as easy and cheap for market makers to trade on the exchange as possible. Else they move elsewhere or have to make their offers more expensive. Which means less trades, less revenue, less users and a less useful exchange.

That is why many exchanges like poloniex have different fees for makers and takers. For example on poloniex the takers pay 0.2% and the makers pay 0.1% (https://poloniex.com/fees/)

Since bisq is currently filling a niche with features regarding privacy etc. it is completely alright to charge more, but it should be a fixed fee, and it should be cheaper for the makers than for the takers because they are responsible for lots of trades (and without them you dont have a market at all). In established markets that could be thousands of trades per day.

Takers are usually people only making a few trades.

The current fee formula also makes it more expensive to trade the larger the distance from the market price is. Which is the reason that it is harder to understand than just telling the user "the fee is 0.2% per trade". I guess the intention is to make sure the market makers dont charge too much so that people who want to e.g. come to the exchange to buy monero see offers at cheaper markups like 1% rather than 1.9%. But in practice it has the opposite effect since now the market makers have to charge an even higher markup for a trade to be "worth it" for them. If you want a market where it is cheap for takers you have to have lots of liquidity (lots of market makers). And the way you get that is by making it as easy, safe and profitable as possible for them to trade on the exchange rather than another one. And then you also make more money for the exchange because of the higher volume of trades rather than charging a higher fee but only having very few trades.

As a start I would use maybe 0.3% or 0.4% for the takers, 0.2% for the makers. Then see if/how it affects the revenue and then adjust it.

The possible counter arguments that fixed fees would result in less revenue or that it would result in market makers charging more are incorrect because the opposite is the case. There is a reason why most exchanges use fixed fees, often less for the maker than the taker, and some also have rebates for trades who are responsible for a higher volume. But we dont really need that yet. Any additional liquidity is already "a lot" right now.

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