poll for the percent based transfer fee

[clayop]

Do you think referral program really work?

@bitcrab , recently I've been wondering about this:
You have always been very skeptical about the usefulness of the referral program but at the same time you run a significant gateway business for CNY.

What is your business model if you don't intend to rely on the referral income?
Where does your revenue come from?

 referral program haven't proved it works here.

gateway have several ways to make profit -  to charge for deposit/withdraw, to cooperate with merchant, to issue privatized smartcoin/UIA and charge market fee. I feel each one is better than referral program.

We can analyze how much profits are generated from referrers' customers.

[clayop]

Statistics says there no big income difference between 1 and 3. One-cent scheme is only for westerners, which is not valid in less affluent areas.

Currently there is no difference between 1 and 3 BTS because nobody is doing such small transfers while the transfer fee is at 30 BTS.
This will change as micro-transactions kick in and it can have a significant impact on our revenue.
It's really good that you've done this analysis but we must not rely on it blindly because this data describes the current state, not the future state when we have the percentage-based fees in place and users change their behavior accordingly.

Better to start a bit high (and possibly lower the fees in the future) than start low and upset people with a fee rise.

Micro-transactions include almost 0 value transactions not for money transfer purpose but for information transfer purpose, such as messaging. Most of them may send 0.0001 BTS with the minimum fee. In terms of this, 1 vs 3 BTS makes very big difference to their costs; 300% increase. Can you imagine how many demands will decrease due to the 300% more cost? The minimum fee is not a source of income but a tool for preventing spam. Currently, the smallest fee is 1 BTS (for account update and call order update, excepting publish feed), and it seems to work in terms of spam prevention.

[tonyk]

We first have to define the range of micro-transaction IMO.

Under $15? $6? $3?
Depending on the numbers, we can set the percentage. I personally like $15 which in turn has percentage fee of 0.02% (1/5000).
Given 0.02%, we can take max 300 BTS that gives equal fee amount to 0.2%/1/50 (but maximum 30 always gives less).

So I would suggest three options that generate about 300k BTS fee (the original value is about 480k)

1. 0.02% / min. 1 BTS / max. 300 BTS
2. 0.1% / min. 1 BTS / max. 60 BTS
3. 0.2% / min. 1 BTS / max. 50 BTS

If we can sacrifice about more fees, we can choose among

1. 0.01% / 1 / 300
2. 0.02% / 1/ 100
3. 0.2% / 1 / 30

These options generate about 200k BTS fee.

my suggestion: 0.2%/1/20
high friction hurt economy, now it's not time to try to make higher profit, it's time to make higher attraction!

so 0.2% for BTS holders and 2% for force settlement on TCNY.

or do you just mean 'high friction' is not a problem when the money end up in your own pocket?

first, 0.2% is a global parameter,  2% for TCNY  force settlement is for one single privatized smartcoin, you need not to touch it if you do not like it.
second, 2% force settlement compensation is to protect shorters, and then eliminate the unnecessary premium.
third, you can withdraw fiat CNY with TCNY with 0.3% fee.

First and only - you judgment is clouded because you do not care about what BTS holders get or if they profit from transaction fees. Your judgment is based on the fact that if the core BTS fees are lower (preferably 0) all fees come to you as a revenue.

So if I were you, I would not comment* on the fee debate threads...but so you did...bluntly!


* I would not even vote on such proposals as a committee member...but I got 50 years ahead with myself with such dreams. lol
Same applies to the fairy-tail named poster, btw.

[bitcrab]

We first have to define the range of micro-transaction IMO.

Under $15? $6? $3?
Depending on the numbers, we can set the percentage. I personally like $15 which in turn has percentage fee of 0.02% (1/5000).
Given 0.02%, we can take max 300 BTS that gives equal fee amount to 0.2%/1/50 (but maximum 30 always gives less).

So I would suggest three options that generate about 300k BTS fee (the original value is about 480k)

1. 0.02% / min. 1 BTS / max. 300 BTS
2. 0.1% / min. 1 BTS / max. 60 BTS
3. 0.2% / min. 1 BTS / max. 50 BTS

If we can sacrifice about more fees, we can choose among

1. 0.01% / 1 / 300
2. 0.02% / 1/ 100
3. 0.2% / 1 / 30

These options generate about 200k BTS fee.

my suggestion: 0.2%/1/20
high friction hurt economy, now it's not time to try to make higher profit, it's time to make higher attraction!

so 0.2% for BTS holders and 2% for force settlement on TCNY.

or do you just mean 'high friction' is not a problem when the money end up in your own pocket?

first, 0.2% is a global parameter,  2% for TCNY  force settlement is for one single privatized smartcoin, you need not to touch it if you do not like it.
second, 2% force settlement compensation is to protect shorters, and then eliminate the unnecessary premium.
third, you can withdraw fiat CNY with TCNY with 0.3% fee.

[tonyk]

We first have to define the range of micro-transaction IMO.

Under $15? $6? $3?
Depending on the numbers, we can set the percentage. I personally like $15 which in turn has percentage fee of 0.02% (1/5000).
Given 0.02%, we can take max 300 BTS that gives equal fee amount to 0.2%/1/50 (but maximum 30 always gives less).

So I would suggest three options that generate about 300k BTS fee (the original value is about 480k)

1. 0.02% / min. 1 BTS / max. 300 BTS
2. 0.1% / min. 1 BTS / max. 60 BTS
3. 0.2% / min. 1 BTS / max. 50 BTS

If we can sacrifice about more fees, we can choose among

1. 0.01% / 1 / 300
2. 0.02% / 1/ 100
3. 0.2% / 1 / 30

These options generate about 200k BTS fee.

my suggestion: 0.2%/1/20
high friction hurt economy, now it's not time to try to make higher profit, it's time to make higher attraction!

so 0.2% for BTS holders and 2% for force settlement on TCNY.

or do you just mean 'high friction' is not a problem when the money end up in your own pocket?

[bitcrab]

Do you think referral program really work?

@bitcrab , recently I've been wondering about this:
You have always been very skeptical about the usefulness of the referral program but at the same time you run a significant gateway business for CNY.

What is your business model if you don't intend to rely on the referral income?
Where does your revenue come from?

 referral program haven't proved it works here.

gateway have several ways to make profit -  to charge for deposit/withdraw, to cooperate with merchant, to issue privatized smartcoin/UIA and charge market fee. I feel each one is better than referral program.

[bitcrab]

We first have to define the range of micro-transaction IMO.

Under $15? $6? $3?
Depending on the numbers, we can set the percentage. I personally like $15 which in turn has percentage fee of 0.02% (1/5000).
Given 0.02%, we can take max 300 BTS that gives equal fee amount to 0.2%/1/50 (but maximum 30 always gives less).

So I would suggest three options that generate about 300k BTS fee (the original value is about 480k)

1. 0.02% / min. 1 BTS / max. 300 BTS
2. 0.1% / min. 1 BTS / max. 60 BTS
3. 0.2% / min. 1 BTS / max. 50 BTS

If we can sacrifice about more fees, we can choose among

1. 0.01% / 1 / 300
2. 0.02% / 1/ 100
3. 0.2% / 1 / 30

These options generate about 200k BTS fee.

my suggestion: 0.2%/1/20
high friction hurt economy, now it's not time to try to make higher profit, it's time to make higher attraction!

[tbone]

I thought the goal with the minimum fee was to set it as low as possible in order to facilitate micro-transactions, while still covering costs and protecting against spam.  Also, why are we debating fees in terms of BTS when we know the value of BTS is going to change?  Finally, Bytemaster specifically said today during the mumble that the minimum fee should be $.005-.01.  So let's debate $.005 vs. $.01. 

Personally I think $.01 would be fine for USD micro-transactions but might be high for CNY micro-transactions.  For that reason, I would be inclined to go with $.005 across the board, unless it's feasible and not overly complicated to have a different limit depending on the asset.  In that case I would go with $.005 for CNY and $.01 for USD and others.  Actually, come to think of it, maybe we could go even higher with the minimum on USD transactions, perhaps as high as $.02.  So that's what I would propose.  A minimum fee of the equivalent of $.005 for CNY transactions, and $.02 for USD and other transactions.  Thoughts? 

[jakub]

Statistics says there no big income difference between 1 and 3. One-cent scheme is only for westerners, which is not valid in less affluent areas.

Currently there is no difference between 1 and 3 BTS because nobody is doing such small transfers while the transfer fee is at 30 BTS.
This will change as micro-transactions kick in and it can have a significant impact on our revenue.
It's really good that you've done this analysis but we must not rely on it blindly because this data describes the current state, not the future state when we have the percentage-based fees in place and users change their behavior accordingly.

Better to start a bit high (and possibly lower the fees in the future) than start low and upset people with a fee rise.

[clayop]

We first have to define the range of micro-transaction IMO.

Under $15? $6? $3?
Depending on the numbers, we can set the percentage. I personally like $15 which in turn has percentage fee of 0.02% (1/5000).

I think $15 is too much to treat it as a "micro-transaction". This way 90% of my daily expenses would be classified as micro-transactions.
I think the threshold for our definition should be around $5, i.e. anything below $5 should be considered "micro-transaction".

So I would suggest three options that generate about 300k BTS fee (the original value is about 480k)

1. 0.02% / min. 1 BTS / max. 300 BTS
2. 0.1% / min. 1 BTS / max. 60 BTS
3. 0.2% / min. 1 BTS / max. 50 BTS

If we can sacrifice about more fees, we can choose among

1. 0.01% / 1 / 300
2. 0.02% / 1/ 100
3. 0.2% / 1 / 30

These options generate about 200k BTS fee.

As for the minimum amount I think 1 BTS is too low. 
I would think that $0.05 is the lowest payment that still makes sense for most people and paying $0.01 (i.e. 20%) for sending $0.05 is still acceptable.
So for me 3 BTS (~$0.01) is the minimum transfer fee we should charge.

Statistics says there no big income difference between 1 and 3. One-cent scheme is only for westerners, which is not valid in less affluent areas.

[jakub]

We first have to define the range of micro-transaction IMO.

Under $15? $6? $3?
Depending on the numbers, we can set the percentage. I personally like $15 which in turn has percentage fee of 0.02% (1/5000).

I think $15 is too much to treat it as a "micro-transaction". This way 90% of my daily expenses would be classified as micro-transactions.
I think the threshold for our definition should be around $5, i.e. anything below $5 should be considered "micro-transaction".

So I would suggest three options that generate about 300k BTS fee (the original value is about 480k)

1. 0.02% / min. 1 BTS / max. 300 BTS
2. 0.1% / min. 1 BTS / max. 60 BTS
3. 0.2% / min. 1 BTS / max. 50 BTS

If we can sacrifice about more fees, we can choose among

1. 0.01% / 1 / 300
2. 0.02% / 1/ 100
3. 0.2% / 1 / 30

These options generate about 200k BTS fee.

As for the minimum amount I think 1 BTS is too low. 
I would think that $0.05 is the lowest payment that still makes sense for most people and paying $0.01 (i.e. 20%) for sending $0.05 is still acceptable.
So for me 3 BTS (~$0.01) is the minimum transfer fee we should charge.

[clayop]

Quick report:

New analysis confirms me minimum fee does not change a lot, consisting with previous conclusion. So 1 BTS makes sense.
And I found 0.2% is an efficient fee level.

To reach the same level of the actually collected fee, we can choose 100 BTS maximum.
50 BTS maximum generates about 60%, and 20 BTS maximum 30%.

Based on this, I could choose 0.2%/1/50, much closer to bitcrab's suggestion.

I don't' understand why you say these new results "do not change a lot".

Previously you said that "my" settings (i.e. 1%/6/300) produced barely 14% of the current income.
Now you say that [0.2%/1/50] gives 60% of the current income.

That's a huge difference.

PS. I'm very glad you've done this analysis. Thanks for that.

@clayop , what about this ^ ?

Oh forget about it. The data used here is not cleaned, so there are huge errors.

[jakub]

Quick report:

New analysis confirms me minimum fee does not change a lot, consisting with previous conclusion. So 1 BTS makes sense.
And I found 0.2% is an efficient fee level.

To reach the same level of the actually collected fee, we can choose 100 BTS maximum.
50 BTS maximum generates about 60%, and 20 BTS maximum 30%.

Based on this, I could choose 0.2%/1/50, much closer to bitcrab's suggestion.

I don't' understand why you say these new results "do not change a lot".

Previously you said that "my" settings (i.e. 1%/6/300) produced barely 14% of the current income.
Now you say that [0.2%/1/50] gives 60% of the current income.

That's a huge difference.

PS. I'm very glad you've done this analysis. Thanks for that.

@clayop , what about this ^ ?

[clayop]

We first have to define the range of micro-transaction IMO.

Under $15? $6? $3?
Depending on the numbers, we can set the percentage. I personally like $15 which in turn has percentage fee of 0.02% (1/5000).
Given 0.02%, we can take max 300 BTS that gives equal fee amount to 0.2%/1/50 (but maximum 30 always gives less).

So I would suggest three options that generate about 300k BTS fee (the original value is about 480k)

1. 0.02% / min. 1 BTS / max. 300 BTS
2. 0.1% / min. 1 BTS / max. 60 BTS
3. 0.2% / min. 1 BTS / max. 50 BTS

If we can sacrifice about more fees, we can choose among

1. 0.01% / 1 / 300
2. 0.02% / 1/ 100
3. 0.2% / 1 / 30

These options generate about 200k BTS fee.

[jakub]

I think it has to be higher than the actual fee or every person planning on something related to the referral program will be disapointed. We need to be VERY carefull with that decision. The low fees of the big mass of tiny transactions has to be compensated by some of the big one to average fees around what we have now.
Someone sending 1000€ doesn't care about the fee being 30 or 90 cents.

This is exactly my approach.
The user does not care too much when bigger amounts are involved - so this is the time when we can earn our revenue.
The user cares a lot when smaller amounts are involved - so this is the time when we need to forgo our revenue.

I guess it's too complicated to have 0.1% up to 100€ and 0.05% up to 10 000€ and cap there at 500 bts ?

Yes, it's way too complicated, not only technically but mainly in terms of marketing.