BIP 72: Sett Vaults and ibBTC Fee Restructuring

BIP | Badger Improvement Proposals
1

Category: Sett Vaults and ibBTC

Scope: Adjust withdrawal fees on Sett vaults and mint/redeem fees on ibBTC

Status: Pending

Objective:

Restructure existing withdrawal fees on vaults to increase flexibility in moving throughout the Badger ecosystem, better enable integrations with other dapps and reduce any friction for users to use ibBTC especially with a large incoming liquidity and utility push ahead for Badger.

Specifics:

Currently Badger sett vaults have a 20% performance fee along with a 0.5% withdrawal fee which has been in place since launch. With the rapidly changing dynamics in DeFi it’s important our fees adjust with it. Especially since Badger as a protocol is changing at the same pace.

After a detailed community discussion, I’d like to propose we change all our vaults by reducing withdrawal fees to 0.1%. This will enable much more flexibility (80% reduction) in how users move between our products, a baseline security threshold for malcious attacks and allow for users to experience Badger on all the chains we deploy on.

Subsequently I suggest we further change the fees on ibBTC to make it easy for anyone to go from renbtc or wbtc into ibBTC and back without absorbing large fees. This is increasingly important as we prepare to launch our ibBTC pool on CRV which we intend to make the highest yielding BTC pool available.

Currently those fees are; Mint 0.2% and Redeem 0.1%. I suggest changing it to Mint 0% and Redeem 0.2%.

That means users can go in and out of vaults for 33% the cost of a trade on Uniswap/Sushiswap and can go from wbtc/renbtc > ibBTC > wbtc/renbtc for 0.3% (same as a Uniswap/Sushiswap trade).

Furthermore: I’d propose an increase in flexibility in recently approved bip 68 to adjust parameters around using up to 100% of the “excess ibBTC yield” to support driving DAO revenue and how thats then utilized for future tokenomic enhancements for holders.

Pre-BIP community discussion along with detailed numerical scenarios of the impact on revenue for the DAO: Find it here

Implementation:

If this BIP were to be approved the Badger core development team would adjust fees in accordance with what was proposed above. These fee adjustments will need to be executed by the DEV MULTISIG.

  • Yes change Sett Vault and ibBTC fees
  • No do not adjust Sett Vault and ibBTC fees

0 voters

2

first (spada doesn’t count)

3

i am pro whatever pamps ibbtc

1 Like
4

Full support. Of course, holding you up on your promise (original proposal on the discord rff) to eventually (in the future) get rid of withdrawal fees.

1 Like
5

full support because BIP72, and the obvious other reasons!!

1 Like
6

no objections - do it!

7

OBVERWELMINGLY ABSOFUCKINGLOOTLY!

This is a complete sentence you silly forum software.

8

Why not make the withdraw fee 0% and allow capital to move freely. It’s what DeFi is all about anyway right?

I know for a fact that I was personally holding on depositing in vaults because of the withdraw fee.

9

Let’s change this as I believe it will mutually benefit the vault TVL growth and also happy badger investors to save more when jumping between vault.

10

This is something we are looking at doing as part of an ongoing vault architecture redesign. Right now though the small withdrawal fee provides some protection against certain attack vectors. With this low of a fee and BADGER emissions providing high APY, we are hoping it removes any doubts people have in hopping in.