**I am unaware of the original rate. However, Aave Forum confirms that 0.0000001% has been under discussion since October 2020. The additional understanding of WHY having an origination fee is important. The Proposal to improve Liqwid protocol , and this current proposal only indicates that other protocols do it, so Liqwid should too. However with the information that this is to reduce risk is more relatable. Examples of what this additional revenue would help protect are far better than Aada, Aave, other defi, and TradFi do it.
After researching some, the internet query was not helpful, so I went to the protocol sites and searched the documents. Compound and Forks do not seem to have Fees, but pretty much everyone else does, with the average fee being 0.5%. Supporting links share more about why/how that protocol uses the fees. The more modest the fee the better. IMO.
I think the OG Fee can garner more support if we can flush out the reasoning on why we should do this. One example @Hizairi mentioned this as another reason in chat on Discord**
Loan origination fee would be paid up-front. Its proceeds would be split 50%-50% between the LQ stakers and the Liqwid Treasury
After this fee is paid, the loan is opened. Over time, interests are generated, and once the loan is repaid, these interests are split as such: 80% for suppliers, 20% is the net margin (split between market reserves, DAO treasury and LQ stakers).
And there would be no interest for the suppliers without the LQ holders in the first place, because no lending platform would exist without LQ holders financing it.
The answer to your question is quite simple in reality.
Based on your own reasoning outlined above, suppliers should also receive a portion of the origination fee. However, you are advocating for the opposite. Iām not suggesting that LQ stakers shouldnāt benefit. Additionally, you havenāt addressed my previous question.
I think a few more days of community input makes sense and would put us at over 2 weeks of community analysis into the proposal details. So early next week sometime to go onchain.
Lenders/suppliers earn 80% of the interest generated and for most of year 1 on mainnet nearly all LQ market emissions have gone to lenders. LQ stakers take on real risk to secure the protocol via Safety Pool and they should be paid for this risk.
Hey Florian,
Iām trying my best to understand the implications of this important vote. Rightly or wrongly, I do trust both you and DC have the best interest of the LQ holders in mind. Therefore I am wanting to delegate my significant stake of Lq to you for this vote. I have not delegated my Lq before, so am I correct in thinking that I just need to copy your delegation key posted above and delegate to that key on the staking page of the Liqwid App? And sign the transaction? Is that all I have to do to delegate my vote to you?
Thanks Florian, Im doing my best to understand everything but for now with such an important vote, Iām backing the team that built this product and trust you have everyones best interest at heart.
