Adjust Fees on DOLA Pools

cryptoharry · August 7, 2025, 2:57pm

Summary

TL;DR

Set the base swap fee to 1 bp on key Curve pools that include DOLA or sDOLA.
Increase the off-peg fee multiplier (OPM) to 20× on the same pools.
Objective: boost router competitiveness and utilization by making DOLA paths cheaper for non-DOLA trades while keeping manipulation resistance via higher off-peg fees.

Fee & OPM Changes

Pool	Current Fee	Proposed Fee	Current OPM	Proposed OPM
DOLA/sUSDe	4 bps	1 bps	2×	20×
DOLA/USR	4 bps	1 bps	3×	20×
DOLA/sUSDS	4 bps	1 bps	2×	20×
scrvUSD/sDOLA	2 bps	1 bps	5×	20×
DOLA/scrvUSD	4 bps	1 bps	5×	20×
DOLA/deUSD	4 bps	1 bps	2×	20×
DOLA/2pool	2 bps	1 bps	5×	20×

Background

DOLA is among the deepest stable assets on Curve Ethereum, and many DOLA-containing LP tokens are enabled as collateral on Inverse Finance’s fixed-rate market (FiRM), allowing LPs to scale positions efficiently.
Despite this depth, utilization (volume/TVL) underperforms, partly because DOLA is not a high-churn retail asset every day and because router paths for non-DOLA trades often traverse two DOLA pools, compounding fees.

Motivation & Rationale

Make DOLA routes router-competitive for non-DOLA swaps
- A typical two-hop route (Asset A → DOLA → Asset B) currently incurs ~8 bps when each leg is 4 bps.
- Reducing base fees to 1 bp makes two-hop DOLA routes ~2 bps total, greatly improving competitiveness.
- Expected outcomes: higher path selection share, increased gross volume (stealing flow from competitors like Uniswap), and ultimately higher total fees for LPs and veCRV (despite lower per-trade fee).
Reduce costs for users leveraging on FiRM
- Leveraged LP loops compound the 4 bps fee, creating onboarding friction.
- Dropping the base fee to 1 bp reduces this friction 4×, making it easier to scale TVL.
Preserve manipulation resistance with a higher off-peg multiplier
- Raising OPM to 20× means effective fees climb quickly as imbalance grows.
- At 1 bp base and 20× OPM, fees reach ~0.20 % (20 bps) under extreme imbalance—deterring large directional pushes while keeping near-peg trades around 1 bp.
- Balances router competitiveness near peg with security off-peg, crucial because LP tokens are used for asset pricing.

Specification

NEW_FEE = 1000000
NEW_MULTIPLIER = 200000000000

ACTIONS = [  
      # DOLA/sUSDe reduce fee to 1 bps and increase off-peg multiplier to 20
      ("0x744793B5110f6ca9cC7CDfe1CE16677c3Eb192ef", "set_new_fee", NEW_FEE, NEW_MULTIPLIER),

      # DOLA/USR reduce fee to 1 bps and increase off-peg multiplier to 20
      ("0x38De22a3175708D45E7c7c64CD78479C8B56f76E", "set_new_fee", NEW_FEE, NEW_MULTIPLIER),

      # DOLA/sUSDS reduce fee to 1 bps and increase off-peg multiplier to 20
      ("0x8b83c4aA949254895507D09365229BC3a8c7f710", "set_new_fee", NEW_FEE, NEW_MULTIPLIER),

      # sDOLA/scrvUSD reduce fee to 1 bps and increase off-peg multiplier to 20
      ("0x76A962BA6770068bCF454D34dDE17175611e6637", "set_new_fee", NEW_FEE, NEW_MULTIPLIER),

      # DOLA/scrvUSD reduce fee to 1 bps and increase off-peg multiplier to 20
      ("0xff17dAb22F1E61078aBa2623c89cE6110E878B3c", "set_new_fee", NEW_FEE, NEW_MULTIPLIER),

      # DOLA/deUSD reduce fee to 1 bps and increase off-peg multiplier to 20
      ("0x6691DBb44154A9f23f8357C56FC9ff5548A8bdc4", "set_new_fee", NEW_FEE, NEW_MULTIPLIER),

      # DOLA/2crv reduce fee to 1 bps and increase off-peg multiplier to 20
      ("0x7d10A8734d985dBB3aD91Fce9c48CcC78b9F8B94", "set_new_fee", NEW_FEE, NEW_MULTIPLIER),

]

phil_00Llama · August 8, 2025, 11:20am

Is this backed by any data? What is the current selection share? What is the expected increase in gross volume? what are the expected higher total fees for LPs and veCRV?

phil_00Llama · August 11, 2025, 10:07am

In my estimation the param changes would cost the DAO about 900$ a day.

cryptoharry · August 11, 2025, 10:43am

Hi Phil, the hypothesis is based on the TVL and fees on other similar stableswap pools, on curve, and elsewhere (like Uniswap). DOLA pools, in general, have an incredible depth advantage over all competing pools, but seriously underperform in terms of volume processed. This proposal hopes to improve the productivity of the pools

cryptoharry · August 11, 2025, 11:07am

DAO Vote live: Proposal - 1173-ownership - Curve

LlamaRisk · August 11, 2025, 11:34pm

Inverse Pools Fee Change - DOLA/sUSDe

Here we have a concise sample analysis for the DOLA/sUSDe pool. For analysis we cosulted COW Swap Curve Pool Order Flow - @takeabreath.

DOLA/sUSDe

Trade Profile

The trade size averaged 77.5k. The trade frequency relative to volume is low, suggesting large infrequent trades. This suggests the pools are used primarily by capital-rich users (unlikely retail).

Competition

The DOLA/sUSDe pool does not face any direct competition within the pools in our sample- meaning there is no AMM consisting of the same constituent tokens.

In indirect competition (pools containing DOLA or sUSDe) it is ranked 6th pool by volume. We categorize other pools as other Curve pools and other DEX pools.

Fee Tiers

We analyzed the fee tier of competing pools that indirectly compete with the DOLA/sUSDe pool. Below we list the fee tier:

pool_address	pool_symbol	pool_category	dex	volume	frequency	avg_trade_size	fee
0x1dd125c32e4b5086c63cc13b3ca02c4a2a61fa9b	USDT/sUSDe	other	fluid	$876.23m	4424	$198.1k	0.01%
0x167478921b907422f8e88b43c4af2b8bea278d3a	sUSDe/sDAI	curve pool	curve	$872.65m	3532	$247.1k	0.02%
0x867b321132b18b5bf3775c0d9040d1872979422e	USDT/sUSDe	other	uniswap	$243.65m	3168	$76.9k	0.05%
0x7eb59373d63627be64b42406b108b602174b4ccc	USDT/sUSDe	other	uniswap	$115.47m	2159	$53.5k	0.01%
0xb819feef8f0fcdc268afe14162983a69f6bf179e	USDC/sUSDe	other	balancer	$67.88m	2418	$28.1k	0.2%
0x744793b5110f6ca9cc7cdfe1ce16677c3eb192ef	DOLA/sUSDe	curve pool	curve	$43.10m	556	$77.5k	0.04%

While the fee alone does not capture the realised execution cost (slippage + gas + fees) for a trade, it may indicate directional adjustment. From our analysis, we can see that DOLA/sUSDe is priced at a higher fee tier compared to other indirectly competing pools.

Yet, cutting fees may lead to a loss in LP welfare if the added volume does not justify the fee reduction. We therefore consider an adjustment to 0.02% as a more balanced approach between priorities. The rationale is that it is less drastic compared to setting the fee to the proposed 0.01%. Purely relative to the indirectly competing Curve pools (sUSDe/sDAI), it also makes a case for 0.02%.

As an experiment in the thesis presented by Inverse that 0.01% fees will create a volume boom for DOLA as a bridge token, Curve may consider to reduce the fees for a 1-2 month period to observe changes in pool behavior and revert the change if revenues do not meet expectations.

phil_00Llama · August 21, 2025, 8:45am

900$ loss per day to the DAO seems to hold