1inch users have traded more than $56 billion in volume through the aggregator since its inception; however, the only fee captured has been a spread surplus (difference between the price at the time of quote and price when the transaction goes through). To drive additional revenue to 1inch and its token, I propose adding a fee on savings since aggregators are designed to save users money by offering traders better prices than any DEX.
In the example below, 1inch routes a 2000 USDC → ETH trade through Clipper; however, the savings from using 1inch is $4.13 (0.21%). The proposed fee would be some amount of the $4.13 savings. Governance could vote whether it should be a fixed or variable percentage of savings.
If 1inch only matches the price of another DEX, then the fee would be waived entirely. Otherwise, users will be incentivized to trade elsewhere.
Two additional ways the fee could be implemented:
- Fee is only added if aggregator routes trade through multiple pathways. 1inch could justify a fee since DEXes cannot do this on their own.
- If worried about users turning to other aggregators with no added fee, implement a fee based on savings compared to other aggregators rather than other DEXes.
Introducing a fee on savings offers a unique way to capture value from traders using 1inch aggregator. I would enjoy hearing feedback on this proposal and whether it’s viable.