I think we need to fix the fee structure for trading

[lil_jay890]

Then go trade on a centralized exchange... obviously I am not being clear.  decentralization has costs that are unavoidable for the benefit of 0 counterparty risk.  it is going to cost you money to have a witness process your transaction to put your order on the order books, not only when the trade is successfully filled.  The correct fee has yet to be determined but it will need to be above 0.

It is not your job to tell me where should I go. I go where I think I need to go. Don't be surprised why most people stay on centralized exchanges.

I don't care what you do.  And I can tell you whatever i want to tell you on this forum regardless if its my job or not.  Just trying to answer why there needs to be fee's.  Sorry it's not the answer you are looking for.

[yvv]

Then go trade on a centralized exchange... obviously I am not being clear.  decentralization has costs that are unavoidable for the benefit of 0 counterparty risk.  it is going to cost you money to have a witness process your transaction to put your order on the order books, not only when the trade is successfully filled.  The correct fee has yet to be determined but it will need to be above 0.

It is not your job to tell me where should I go. I go where I think I need to go. Don't be surprised why most people stay on centralized exchanges.

[yvv]

If you are placing and canceling thousands of orders with a bot and doing less than $55,000 of volume then chances are your bot is not effective and is spamming the network.

This is not spamming. This is a competition. With normal competition, there will be few winners who make profit, and thousands of losers who can not make a single trade for days. But you don't want to scare those ammature traders away with fees, because if you do, you'll suppress a competition and your service will go into crap. Loser's loss is a winner's profit. When winners can't make profit, they leave.

[lil_jay890]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Paying for an order which is not filled is not ridiculous. Placing an order has costs associated with it and the cost is significant in every trading system. Some systems just have chosen to subsidize this cost by increasing other fees.

And while you don't necessarily profit from an order that isn't filled (you can, by the way, if you're using it as part of some trading methods), you certainly had the opportunity to profit from it.

Taking care of restroom in a fast food place has also associated costs with it, but if they will start charging fees for using their restroom, then good luck in attracting customers.

Most places make you buy something if you want to use their facilities.

In some shitty slums may be so, but in the world where I live they allow me to use their facilities with no conditions, because they know that if I like their place I will buy something from them and come back again. When I come to eatery, I want to pay for food. Washing hands, using toilet, sitting at the table has to be included into price of damn hamburger.  If they don't do this, I turn around and walk away. You have to decide what are you going to be: just another shitty exchange or high quality  service.

The reason why people get "0" fees for trades is because of centralization by your broker.  You actually are getting a raw deal since the broker will expand the spread to make money.  You are trading within their internal pool of funds and stocks... once you go out of their pool, there are costs associated with placing orders.  Because bitshares is decentralized and all transactions are irreversible, you must pay a fee for that work to be done.

There are costs associated with everything. So what? Your costs is not my problem. As you said, I must pay a fee for work to be done. The work is done when the trade is made. Before that, I don't owe you nothing.

Then go trade on a centralized exchange... obviously I am not being clear.  decentralization has costs that are unavoidable for the benefit of 0 counterparty risk.  it is going to cost you money to have a witness process your transaction to put your order on the order books, not only when the trade is successfully filled.  The correct fee has yet to be determined but it will need to be above 0.

[yvv]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Paying for an order which is not filled is not ridiculous. Placing an order has costs associated with it and the cost is significant in every trading system. Some systems just have chosen to subsidize this cost by increasing other fees.

And while you don't necessarily profit from an order that isn't filled (you can, by the way, if you're using it as part of some trading methods), you certainly had the opportunity to profit from it.

Taking care of restroom in a fast food place has also associated costs with it, but if they will start charging fees for using their restroom, then good luck in attracting customers.

Most places make you buy something if you want to use their facilities.

In some shitty slums may be so, but in the world where I live they allow me to use their facilities with no conditions, because they know that if I like their place I will buy something from them and come back again. When I come to eatery, I want to pay for food. Washing hands, using toilet, sitting at the table has to be included into price of damn hamburger.  If they don't do this, I turn around and walk away. You have to decide what are you going to be: just another shitty exchange or high quality  service.

The reason why people get "0" fees for trades is because of centralization by your broker.  You actually are getting a raw deal since the broker will expand the spread to make money.  You are trading within their internal pool of funds and stocks... once you go out of their pool, there are costs associated with placing orders.  Because bitshares is decentralized and all transactions are irreversible, you must pay a fee for that work to be done.

There are costs associated with everything. So what? Your costs is not my problem. As you said, I must pay a fee for work to be done. The work is done when the trade is made. Before that, I don't owe you nothing.

[lil_jay890]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Paying for an order which is not filled is not ridiculous. Placing an order has costs associated with it and the cost is significant in every trading system. Some systems just have chosen to subsidize this cost by increasing other fees.

And while you don't necessarily profit from an order that isn't filled (you can, by the way, if you're using it as part of some trading methods), you certainly had the opportunity to profit from it.

Taking care of restroom in a fast food place has also associated costs with it, but if they will start charging fees for using their restroom, then good luck in attracting customers.

Most places make you buy something if you want to use their facilities.

In some shitty slums may be so, but in the world where I live they allow me to use their facilities with no conditions, because they know that if I like their place I will buy something from them and come back again. When I come to eatery, I want to pay for food. Washing hands, using toilet, sitting at the table has to be included into price of damn hamburger.  If they don't do this, I turn around and walk away. You have to decide what are you going to be: just another shitty exchange or high quality  service.

The reason why people get "0" fees for trades is because of centralization by your broker.  You actually are getting a raw deal since the broker will expand the spread to make money.  You are trading within their internal pool of funds and stocks... once you go out of their pool, there are costs associated with placing orders.  Because bitshares is decentralized and all transactions are irreversible, you must pay a fee for that work to be done.

[yvv]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Paying for an order which is not filled is not ridiculous. Placing an order has costs associated with it and the cost is significant in every trading system. Some systems just have chosen to subsidize this cost by increasing other fees.

And while you don't necessarily profit from an order that isn't filled (you can, by the way, if you're using it as part of some trading methods), you certainly had the opportunity to profit from it.

Taking care of restroom in a fast food place has also associated costs with it, but if they will start charging fees for using their restroom, then good luck in attracting customers.

Most places make you buy something if you want to use their facilities.

In some shitty slums may be so, but in the world where I live they allow me to use their facilities with no conditions, because they know that if I like their place I will buy something from them and come back again. When I come to eatery, I want to pay for food. Washing hands, using toilet, sitting at the table has to be included into price of damn hamburger.  If they don't do this, I turn around and walk away. You have to decide what are you going to be: just another shitty exchange or high quality  service.

[tbone]

People are discussing this polo and I agree with the traders (who by the way, are one of our main target markets):

* The fee to place a trade needs to be extremely low.  Just enough to prevent spam.
* The fee to cancel an order should be 0.
* The fee upon the EXECUTION of an order should be "high" (aka, current levels).

I agree with Ander's premise that the cost for placing a trade should be low, the cost to cancel should be zero, and the cost of successful trade execution should be high.  bytemaster's proposal is intended to accomplish these goals while providing incentive to NOT leave orders open on the dex.  I think it's an elegant solution, although I'm not sure there's much of a problem with people keeping unnecessary orders open because when your order is open it ties up your funds.  So that already provides far more incentive to close any orders that don't need to be open. 

With that in mind, I think it would be much easier for people to understand the fee structure if we simply charged a spam fee to place an order, then either zero to cancel OR a full fee upon successful trade execution ($.05, $.125, or $.25 - after cash back - depending on membership level). 

By the way, it should be clear to everyone that one of the things bytemaster built into his proposed solution is an order placement fee that varies depending on membership level.  So in his example, the cost to place an order (that later gets cancelled) is $.002 for lifetime members, $.0755 for annual members, and $.201 for basic members.  Personally, I think the order placement fee in this scheme is WAY too high for basic and annual members.  Ander's idea was to avoid spam (not to profit massively from orders that end up getting cancelled) and I agree with him 100%.  So I think everyone should get charged the same order placement fee.  Perhaps UNLESS people with lower membership levels pose more of a spam risk.  In which case I would support a sliding scale, but a much more gradual one.  Perhaps $.002, $.004, and $.005.  Remember, most people are not spamming, and I think charging them much more than spam deterrent fees just to place an order would be very counterproductive.

@Ander: you're the OP on this thread and it seems there is a lot of support for your original premise.  What do you think about this?

[lil_jay890]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Paying for an order which is not filled is not ridiculous. Placing an order has costs associated with it and the cost is significant in every trading system. Some systems just have chosen to subsidize this cost by increasing other fees.

And while you don't necessarily profit from an order that isn't filled (you can, by the way, if you're using it as part of some trading methods), you certainly had the opportunity to profit from it.

Taking care of restroom in a fast food place has also associated costs with it, but if they will start charging fees for using their restroom, then good luck in attracting customers.

Most places make you buy something if you want to use their facilities.

[lil_jay890]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Trading and sitting in a restaurant are not equatable.  When an order is placed, work has to be done to make sure that order is facilitated under the desired conditions.  This work isn't done for free unless when the order is triggered you make a substantial amount in trading fees.  Think of the order placing fee as a cover charge when going to a night club.

 Before long there will be fees charged by stock exchanges to combat high frequency trading as well.

[BunkerChainLabs-DataSecurityNode]

I am concerned with the lack of real data surrounding this.

That said, I am going to contribute to the madness.

The proposal set forth as it is seems reasonable.

[DestBest]

https://github.com/cryptonomex/graphene/issues/393

Quote from BM on GitHub:

Market participants expect placing / moving orders to be cheap and filling orders to be expensive.

To prevent spam, all transactions require some kind of fee.
Placing orders consumes memory and cannot be trivially cheap so needs a high fee.
Canceling orders frees memory and has historically been free.

We can make placing orders free, filling orders (relatively) expensive, and canceling orders cheap with the following change.

User pays $0.25 to place an order
User pays $0.001 to cancel an order, and gets a refund of $0.25 * NETWORK_FEE_PERCENT
If the order fills then there is no refund of the $0.25
Under this plan the cost to place / update an order is $0.001 while the cost of having an order filled is $0.25.

The only remaining issue with the above is that part of the original fee ($0.20) goes to the referrer who may have withdrawn their cashback. To keep things simple, the only fee that gets refunded is the network fee.

If the user is a lifetime member then it looks like this:

User pays $0.25 to place an order and receives $0.20 cash back
User pays $0.001 to cancel an order, and gets a refund of $0.05 and $0.0008 cash back. (total cost $0.0002)
If the order is actually filled the user paid $0.05
If the user is an annual subscriber then it looks like this:

User pays $0.25 to place an order and receives $0.125 cash back
User pays $0.001 to cancel an order and receives $0.0005 cash back and a refund of $0.05 (total cost $0.0755)
If the order is actually filled the user paid $0.125
If the user is a basic member then it looks like this:

User pays $0.25 to place an order
User pays $0.001 to cancel an order and gets $0.05 back (total cost $0.20)
If the order is actually filled the user pays $0.25
The break even point for deciding whether to upgrade to a lifetime member is if the user would end up canceling 500 orders. If they end up canceling 10000 orders because they are a market maker then the average cost would be ($100 + 50000*.0002)/50000 => 0.0022 and the total spent would have been $110 dollars.

As long as the average order size is greater than $25 dollars, the market fees on the filled orders will be less than other exchanges that charge (0.2%) of volume. Anyone who does $55,000 of volume will pay over $110 in fees on centralized exchanges. If you are placing and canceling thousands of orders with a bot and doing less than $55,000 of volume then chances are your bot is not effective and is spamming the network.

[xiahui135]

I support Ander's idea.

[bytemaster]

https://github.com/cryptonomex/graphene/issues/393

[liondani]

or maybe there can be a "market maker" membership for high trade

 

PS Maybe monthly "market maker"  membership's ....

[sittingduck]

You think.    Do the math. What was your volume?

[cb007]

If were saying we cant accept .5 BTS or .1 BTS etc as the trade opening fee because the price point is too low for such an order to then sit in memory for x amount of time - why not then add a secondary pricing policy that charges over time whilst an order is left open?

Not sure if thats a better or worse solution - but it at least doesnt turn bots away at the door and penalise you as heavily for simply moving a trade.

I have something like 50,000 trades on Polo either via bot or manually - i think additional charges over the duration of an open order would have impacted me far less than the higher fees for opening/closing unfilled orders.

[clayop]

The cost to opening an order is MEMORY allocation that stays around until the order is canceled (if ever). 
A "one time promotional" could allow an attacker to force full nodes to have GB of memory allocated for ever for almost no cost.

Quick question. How many open orders can we handle at once? And what can be the lowest fee rate for opening orders?

[luckybit]

so the point is "how to make the liquidity grow?"

the answer is to attract market maker.

market maker update orders frequently, robot trading is always used. so if placing orders cannot be free, it should be low enough, if market maker always need to calculate the fees before updating orders,  they would not like to trade.

maybe there can be a "market maker" membership for high trade,  low transfer demand users, an account can pay say 1000 BTS monthly, and then enjoy the counter spamming fee for each order updating.

These are some good ideas. I agree we need market makers. We need whales. The question is how would we change the fee structure without damaging other parts of the Bitshares economic machine?

[xiahui135]

Lets assume you are a trader on BitShares and plan on updating your order often, so become a lifetime member.  The cost to place an order is 2 BTS or $0.01.

20k BTS for lifetime member is also a cost. Why don't we think about a normal user who is not a lifetime member?

I have paid more than $100 in fees to BitStamp and am a "normal" user.  Paying a lifetime membership fee makes sense and is still cheaper than paying regular exchange fees.   If I were an active trader on BitStamp my regular fees would be an order of magnitude higher than a lifetime member.   So I think it is safe to assume that anyone who will trade so much that the fees matter it is worth it to become lifetime members.  Everyone else it is still cheaper at the full rate.

It is all psychological.

I feel 1 usd fee not expensive if the order filled.

0.01 bts fee is expensive when it not.

[xiahui135]

Agree

[clayop]

Lets assume you are a trader on BitShares and plan on updating your order often, so become a lifetime member.  The cost to place an order is 2 BTS or $0.01.

20k BTS for lifetime member is also a cost. Why don't we think about a normal user who is not a lifetime member?

I have paid more than $100 in fees to BitStamp and am a "normal" user.  Paying a lifetime membership fee makes sense and is still cheaper than paying regular exchange fees.   If I were an active trader on BitStamp my regular fees would be an order of magnitude higher than a lifetime member.   So I think it is safe to assume that anyone who will trade so much that the fees matter it is worth it to become lifetime members.  Everyone else it is still cheaper at the full rate.

It is all psychological.

Probably 95% of users don't pay $100 a month for trading fee. They only pay 0.1~0.2% of their order when it filled.

We have a high level of capacity (100 TPW atm). We don't have to be parsimonious. Why don't we sell our network resources at a lower price (with lower trading fees)? IMHO, trading fee at the initial stage of ecosystem expansion, in which attracting new users is the most priority, should be as low as to prevent spammy transactions. In BTS 1.0 with 0.1 fee, there were no spamming attacks. So I would suggest 2.5 BTS trading fee for non-lifetime members (and 0.5 for lifetime members as like a default setting of BTS 1.0).

agree 0.5 BTS trading fee for lifetime member.

the method to get money from customers' pocket really matters.
a good method can make the customers pay much with happiness.
a bad method always make the customers feel unhappy, and always decide not to buy.

now Bitshares looks like a restaurant that few people sit inside and enjoy food, but the manager keep on shouting "go out, poor guys, don't sit here without buying food!"

yunbi is free, btc38 charges 0.1%, polo charges 0.2%, bitstamp may charge more.

but why more users trade BTS in polo and btc38, not yunbi? yes, liquidity.

now the liquidity in DEX is low, either high or low fees, few trading chance here.

so the point is "how to make the liquidity grow?"

the answer is to attract market maker.

market maker update orders frequently, robot trading is always used. so if placing orders cannot be free, it should be low enough, if market maker always need to calculate the fees before updating orders,  they would not like to trade.

or maybe there can be a "market maker" membership for high trade,  low transfer demand users, an account can pay say 1000 BTS monthly, and then enjoy the counter spamming fee for each order updating.

 

[mike623317]

Also, they're used to doing it a certain way already. Going against the grain is never good for adoption.

^^^ I think this is the real takeaway.

[bitcrab]

Lets assume you are a trader on BitShares and plan on updating your order often, so become a lifetime member.  The cost to place an order is 2 BTS or $0.01.

20k BTS for lifetime member is also a cost. Why don't we think about a normal user who is not a lifetime member?

I have paid more than $100 in fees to BitStamp and am a "normal" user.  Paying a lifetime membership fee makes sense and is still cheaper than paying regular exchange fees.   If I were an active trader on BitStamp my regular fees would be an order of magnitude higher than a lifetime member.   So I think it is safe to assume that anyone who will trade so much that the fees matter it is worth it to become lifetime members.  Everyone else it is still cheaper at the full rate.

It is all psychological.

Probably 95% of users don't pay $100 a month for trading fee. They only pay 0.1~0.2% of their order when it filled.

We have a high level of capacity (100 TPW atm). We don't have to be parsimonious. Why don't we sell our network resources at a lower price (with lower trading fees)? IMHO, trading fee at the initial stage of ecosystem expansion, in which attracting new users is the most priority, should be as low as to prevent spammy transactions. In BTS 1.0 with 0.1 fee, there were no spamming attacks. So I would suggest 2.5 BTS trading fee for non-lifetime members (and 0.5 for lifetime members as like a default setting of BTS 1.0).

agree 0.5 BTS trading fee for lifetime member.

the method to get money from customers' pocket really matters.
a good method can make the customers pay much with happiness.
a bad method always make the customers feel unhappy, and always decide not to buy.

now Bitshares looks like a restaurant that few people sit inside and enjoy food, but the manager keep on shouting "go out, poor guys, don't sit here without buying food!"

yunbi is free, btc38 charges 0.1%, polo charges 0.2%, bitstamp may charge more.

but why more users trade BTS in polo and btc38, not yunbi? yes, liquidity.

now the liquidity in DEX is low, either high or low fees, few trading chance here.

so the point is "how to make the liquidity grow?"

the answer is to attract market maker.

market maker update orders frequently, robot trading is always used. so if placing orders cannot be free, it should be low enough, if market maker always need to calculate the fees before updating orders,  they would not like to trade.

or maybe there can be a "market maker" membership for high trade,  low transfer demand users, an account can pay say 1000 BTS monthly, and then enjoy the counter spamming fee for each order updating.

[clayop]

The market may be perceiving this high trading fee as a unfavorable factor. We would rather take marketers perspective, not purely engineering one. Let's listen to the market first, then find the optimal point.

[yvv]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Paying for an order which is not filled is not ridiculous. Placing an order has costs associated with it and the cost is significant in every trading system. Some systems just have chosen to subsidize this cost by increasing other fees.

And while you don't necessarily profit from an order that isn't filled (you can, by the way, if you're using it as part of some trading methods), you certainly had the opportunity to profit from it.

Taking care of restroom in a fast food place has also associated costs with it, but if they will start charging fees for using their restroom, then good luck in attracting customers.

[dannotestein]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Paying for an order which is not filled is not ridiculous. Placing an order has costs associated with it and the cost is significant in every trading system. Some systems just have chosen to subsidize this cost by increasing other fees.

Why are we supposed to keep 3 cents? Are there any specific reasons? If lowering trading fee lead to maximization of profit (by inducing more demands), we should do.

If it leads to maximization of profit, you would of course be correct.

But I find your argument far from compelling that it will lead to maximum profit, however. The fee is adjustable: we can always change it if it proves to be a true barrier to adoption. Deciding already that it's a barrier to adoption at the current time is unreasonable, IMO. It's just too early. We have other much more significant barriers to adoption that we should be focusing on: documentation, marketing, web wallet capabilities and usability, etc. The list is really endless of serious enhancements we need to make, and this just doesn't register for me by comparison.

[clayop]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Paying for an order which is not filled is not ridiculous. Placing an order has costs associated with it and the cost is significant in every trading system. Some systems just have chosen to subsidize this cost by increasing other fees.

Why are we supposed to keep 3 cents? Are there any specific reasons? If lowering trading fee lead to maximization of profit (by inducing more demands), we should do.

[dannotestein]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

Paying for an order which is not filled is not ridiculous. Placing an order has costs associated with it and the cost is significant in every trading system. Some systems just have chosen to subsidize this cost by increasing other fees.

And while you don't necessarily profit from an order that isn't filled (you can, by the way, if you're using it as part of some trading methods), you certainly had the opportunity to profit from it.

[yvv]

It is not only the amount of fee which matters, what are you paying for matters too. It is ok if fancy restaurant charges more then fast food eatery, but I don't know anybody in good mind who would agree to pay anything just for sitting in a restaurant having no food. It is ok to pay $1 fee for a trade which brings you $5 profit, but paying for an offer which was not even filled is ridiculous. It is not physiological, this is common sense.

[dannotestein]

Even for a regular user (non-lifetime member), we're talking about 3-6 cents USD per order. Any trader who makes trading decisions based on this cost will not bring significant business to the blockchain. They are just playing around.

[clayop]

Lets assume you are a trader on BitShares and plan on updating your order often, so become a lifetime member.  The cost to place an order is 2 BTS or $0.01.

20k BTS for lifetime member is also a cost. Why don't we think about a normal user who is not a lifetime member?

I have paid more than $100 in fees to BitStamp and am a "normal" user.  Paying a lifetime membership fee makes sense and is still cheaper than paying regular exchange fees.   If I were an active trader on BitStamp my regular fees would be an order of magnitude higher than a lifetime member.   So I think it is safe to assume that anyone who will trade so much that the fees matter it is worth it to become lifetime members.  Everyone else it is still cheaper at the full rate.

It is all psychological.

Probably 95% of users don't pay $100 a month for trading fee. They only pay 0.1~0.2% of their order when it filled.

We have a high level of capacity (100 TPW atm). We don't have to be parsimonious. Why don't we sell our network resources at a lower price (with lower trading fees)? IMHO, trading fee at the initial stage of ecosystem expansion, in which attracting new users is the most priority, should be as low as to prevent spammy transactions. In BTS 1.0 with 0.1 fee, there were no spamming attacks. So I would suggest 2.5 BTS trading fee for non-lifetime members (and 0.5 for lifetime members as like a default setting of BTS 1.0).

[bytemaster]

Lets assume you are a trader on BitShares and plan on updating your order often, so become a lifetime member.  The cost to place an order is 2 BTS or $0.01.

20k BTS for lifetime member is also a cost. Why don't we think about a normal user who is not a lifetime member?

I have paid more than $100 in fees to BitStamp and am a "normal" user.  Paying a lifetime membership fee makes sense and is still cheaper than paying regular exchange fees.   If I were an active trader on BitStamp my regular fees would be an order of magnitude higher than a lifetime member.   So I think it is safe to assume that anyone who will trade so much that the fees matter it is worth it to become lifetime members.  Everyone else it is still cheaper at the full rate.

It is all psychological.   

[yvv]

People are fine with withdrawal fee because they get refunded if withdrawal is canceled or failed. If people are charged for trade which did not happen, they get unhappy for sure.

[Method-X]

The cost to opening an order is MEMORY allocation that stays around until the order is canceled (if ever). 
A "one time promotional" could allow an attacker to force full nodes to have GB of memory allocated for ever for almost no cost.

Ah, so it's an attack vector...

By the way, the reason traders don't like being charged for unfilled orders is psychological/behavioral. Most people are not as rational as you and will perceive unfilled order fees as being "high" and think nothing of it when charged 1.5% to withdraw coins from an exchange. Also, they're used to doing it a certain way already. Going against the grain is never good for adoption.

[monsterer]

The cost to opening an order is MEMORY allocation that stays around until the order is canceled (if ever). 
A "one time promotional" could allow an attacker to force full nodes to have GB of memory allocated for ever for almost no cost.

Storing all open orders in memory seems a bit mad, forgive me. How is this going to scale when you have thousands of DEX markets?

Filled orders should pay a percentage trade fee, IMO because traders are used to that already.... set cancels and moves to spam minimum fee.

[clayop]

Lets assume you are a trader on BitShares and plan on updating your order often, so become a lifetime member.  The cost to place an order is 2 BTS or $0.01.

20k BTS for lifetime member is also a cost. Why don't we think about a normal user who is not a lifetime member?

[luckybit]

I kind of agree ... we first need to incentivize people to use the dex .. once we have some traction we can increase the fees ..
how about a public offer for 3 months of almost zero fees in the dex!! just enough to prevent spamming?

Suppose Bitshares has another year like 2014 where it loses traction, has no marketing, and has decreasing fees in a desperate attempt to try to attract users? How will that downward spiral look?

I say Bitshares should take profit as it comes from wherever it can. Fees are the first place it can get a profit and until you find a replacement the fees should stay the same. If you find a replacement source to fuel Bitshares then you can talk about lowering the fees but lowering profit is not an option.

The referral program is perhaps the only way Bitshares will gain traction and if you defund that you are defending the entire marketing campaign and perhaps any possibility of userbase growth among high net worth individuals.

[bytemaster]

The cost to opening an order is MEMORY allocation that stays around until the order is canceled (if ever). 
A "one time promotional" could allow an attacker to force full nodes to have GB of memory allocated for ever for almost no cost.

I did the math in the past, but I will do it again now.

I recently sold  $1300 worth of Bitcoin on BitStamp and they charged me over $3 for this.

Lets assume you are a trader on BitShares and plan on updating your order often, so become a lifetime member.  The cost to place an order is 2 BTS or $0.01.
You would have to update your order 300 times before the costs approach that of BitStamp. 
This is enough to update your order 10 times per day for an entire month.

For normal users the DEX is MUCH cheaper because they are adjusting their orders MANUALLY.  The value of the user's time to MANUALLY update orders is far greater than the $0.01 fee. 

Lets get some real numbers from real traders:

1. What is your volume (how much do you currently pay in fees)
2. How often do you update your orders (how much would you pay on the DEX)

I think for almost everyone except very high frequency traders the DEX is cheaper. 

[yvv]

Long time ripple user here who is really excited by bitshares project. Some advise: you may want to consider to look at ripple fee model. The have very tiny transaction fee which is paid whenever any type of transaction is submitted. The purpose of this fee is anti-spam. Besides that, they have a transfer fee which is set by asset issuer and is paid whenever the asset changes hands to reward the issuer.  Something like this could be adapted for bitshares ecosystem.

[clayop]

Totally agree.  High fees for filled orders, but low fees for opening orders.

Add: If this is not possible in the short-term, why don't we keep all trading fee low and then start to make a change? (like xeroc's suggestion)

[topcandle]

Agreed. This is reasonable.  Although placing a order will have to be more temporary which is refundable upon canceling.

[xeroc]

I kind of agree ... we first need to incentivize people to use the dex .. once we have some traction we can increase the fees ..
how about a public offer for 3 months of almost zero fees in the dex!! just enough to prevent spamming?

[Ander]

People are discussing this polo and I agree with the traders (who by the way, are one of our main target markets):

* The fee to place a trade needs to be extremely low.  Just enough to prevent spam.
* The fee to cancel an order should be 0.
* The fee upon the EXECUTION of an order should be "high" (aka, current levels).


Traders want to be able to place an order but be able to move it later, and not lose to a fee.  At polo or other sites I can place and remove an order for no fee at all.  Our fee for this should be just enough to prevent spam, like 1 BTS or even .1 BTS. 


When an order executes, the fee should be extracted then.  (If it executes in pieces, its important that it is only paid one time in total).


This is what we need to get traders on board.  We need the fee to mostly be paid at execution, not when placing or moving an order!  Traders dont want to risk paying a fee for an order that doesnt happen.


Please consider this.  I think we should do the following:
* Modify the fees as described above.
* Post something explaining the change and telling traders "we listened to your feedback and are changing things to meet your needs".



Note that I am not advocating low fees, I am simply advocating not charging people for non-executed/cancelled orders, any more than necessary to prevent spam.