As you all know the unstake fee is is currently 1.75% although this may be sufficient in the future when we develop as a more robust ecosystem with diverse products, for now I think that we need stronger deflationary pressures along with better incentives to encourage long term growth. Other protocols for example such as the Graph incur a token burn along with a thawing period to withdraw, while Aave has a 30 day cooldown period as well.
Keeping this in mind I think the current fee of 1.75% to unstake is far too low given that there is no “cooldown period” and that it can be done instantly also;
1) The rewards rate (and inflation) in the staking module is a generous 53.7%+
2) Most people who unstake do so to sell which further creates inflationary pressures on the xToken ecosystem.
3) Current Marketcap and illiquidity cannot support sell pressure without lowering APR thus making using xToken products less attractive and lowering AUM.
I propose that we increase the unstake fee to 5% and direct 1% of these funds to the xToken treasury. This would encourage users to stake their funds longer rewarding hodlers, while also providing funds to the treasury which will be used to benefit the ecosystem. I see this encouraging “good behavior” and it could also have the effect of luring in more stakers who would prefer a 4% over 1.75% tax on unstakers.
I think 5% is good because it requires about a month of staking, but would like community input on this topic, as I think it can be tweaked upwards or downwards.