Are no fees or fixed fees good for the public chain?

At present, some new chains have adopted no fee or a very low fee close to a fixed fee, such as Flow, Solana, etc.

Reducing the fee is a good thing for ordinary users, who can use the chain’s services at a lower cost, but at the same time it also means more junk transactions that affect the service.

For many public chains, what’s the problem?

  • First of all, the operating cost of the public chain has not been reduced. The low handling fee, which is similar to the subsidy, makes the chain need to subsidize a large number of tokens to nodes through inflation every year.
  • Second, after the capacity of the chain reaches the upper limit, the fixed fee will make it impossible for users to increase the price to get their transactions on the chain, because the chain is at full capacity dealing with bot spam transactions.
  • Finally, due to the reduction in transaction fees, the improved performance of the chain will be filled with arbitrage transactions. The transaction fee of 0.0005U will make the robot block the chain for a profit of 0.001U. If the performance of the chain improves is just for arbitrage Robots can make arbitrage at lower profits, so the performance improvement is of little significance.

Maybe, we need a stable and high-performance chain, but in the absence of necessary anti-DDOS means, a fee-free Defi public chain is not a good idea.

1 Like