Also, by not having the trading fee's part of the referral program or making them so low that they add 0 value, any third party platform like mt4 will never be implemented. There is no way to get the development money back from everything I can tell. Much less have any money left over to do maintenance on the system. The only way it may work would be by manipulating the spread in the client terminal wide enough that mt4 can turn a profit. This effectively screws the trader twice though.
Registrar for MT4 could earn a lot from LTM-fee...much more than what he could earn on trading fee. IMO.
So there would actually be a way to get the development money back etc.
I don't understand why people here think we need to emulate current crypto exchanges. Crypto exchanges are tiny and professional (bank, hedgefund) traders would never trade on those platforms. The most popular platforms use a flat fee or commission. This proposal is going to set bitshares back massively in terms of adoption by traders.
Probably because we can see a lot of exchange working with % trading fee, and we se a lot of volume in those exchange. Right now:
Poloniex, only on eth/btc, has 28k btc volume.
Btc38 only on cny/btc has 500 btc volume.
They seem to work quite well, and poloniex has 0.2% trading fee per side iirc.
Attracting traders should be the priority of bitshares. It will shrink spreads, increase volume, and make money for the blockchain. Doing a percentage based fee will only drive them away. You are effectively driving away liquidity by charging more money to trade larger orders. Plus it doesn't cost anymore resource wise to process large trades vs small trades.
We thought that charging only 0.01% would still make the dex cheaper than the majority of other exchanges.
Would you suggest to have no % trading fee at all until we have more volume?
If you are going to do the %based fee's, there needs to be a ceiling involved. My back of the napkin sweetspot would be %based fee's up to $20... $20 is half the price that many ECN brokers charge to do larger forex orders.
Having a ceiling is a good idea imo, but it would need development tho.
Thanks for your suggestion.
The problem is you have to pay for a LTM membership. I can sign up with dozens of forex and stock brokers right now, get better tools and better trade reporting, without having to pay a dime.
As far as your comment about how poloniex and btc38 have good volume... You could take all the volume of every crypto traded today and it is less than 0.002% of the daily forex market. There are bank traders that individually do multiples of what the entire crypto market does daily. Those guys are not using percentage based fee's and neither are the guys trading much lower amounts. If you charge 0.1% on the forex market, the daily fee's would be $6 billion dollars. That number would never be attained because the fee's would eliminate the volume. The lowered volume would then eliminate much of the liquidity that is seen today.
There is no extra cost for brokers to do larger trades today... that's why you don't see fee's associated with doing large trade sizes. In bts there is also nothing different between trading 5bts vs 50,000,000bts. The work required is the same. Attempting to charge exorbitant fees for large transactions will be seen as a tax and it will drive traders away. Their needs to be a ceiling on trading fee's if % based fees are implemented. I have said before though that traders do not care if the fee is 1 cent or 1 dollar, that amount is minuscule and won't effect demand. The problem arises when the fees start approach the triple digit mark for large trades and the double digit mark for smaller ones.
To Cubes question: I could put a trade on in forex for 100 lots ($10,000 per lot = $1million) and not be charged any commision. I would pay a decent amount for the spread (probably around $3000), but still no fee or maybe a very small commission. I could also do this with only $50K as collateral, but lending is a story for another day.
Long story short: Percentage based fee's may be helpful for low volume traders, but they are the death of the liquidity providers we desperately need. A fee cap is absolutely essential.