QIP214: Fee Setting on Ethereum

This proposal seeks to set terms for fees charged by the protocol. The goal of these changes is to make the effective ROI on MAI loans 5% for QiDao. The reasonings for this goal are the following:

Set cost of MAI loans on par with the cost on other stablecoin projects Stabilize MAI at its current TVL and level of expenditure on Ethereum Allow the protocol to onboard new loans. Per QIP209, QiDao can only enable loans on chains where MAI is at peg.

Below are the average loan costs for comparable collaterals at peer protocols.

• yvLINK: no comparable protocols. GHO offers 5.36% for regular LINK in open p2p lending pool
• ETH Curve LPs: no comparable protocols
• WBTC: MIM (7% interest), GHO (5.36% interest), DAI (5.78% interest)
• WETH: MIM (7% interest), GHO (5.36% interest), DAI (5.53% interest)
• wstETH: GHO (5.36% interest), DAI (5.24% interest)
• cbETH: GHO (5.36% interest)
• LDO: GHO (5.78% interest)

Note: GHO is a comparable stablecoin by size, but not by product, given that third party users can borrow collaterals from pools. This is different from the CDP offering at QiDao.

On Ethereum, collateralization levels are much higher than on L2s. As such, the performance fees on loans on L1 do not need to be as high in order to reach the 5% ROI threshold. For context, these are the weighted average collateralizations for each of the collaterals where performance fees will be applied:

• cbETH: 308%
• wstETH: No open loans
• stETH Curve LPs: 450%

Fees

• WETH: Current: 0.5% repayment fee Update: 5% interest, no repayment fee
• WBTC: Current: 0.5% repayment fee Update: 5% interest, no repayment fee
• yvWETH: Current: 0.5% repayment fee Update: 5% interest, no repayment fee
• yvLINK: Current: 0.5% repayment fee Update: 5% interest, no repayment fee
• sd-stETH-ETH (original): Current: 0.5% repayment fee Update: 5% interest, no repayment fee
• yv-stETH-ETH (original): Current: 0.5% repayment fee Update: 5% interest, no repayment fee
• sd-stETH-ETH: Current: 0.36% performance fee, 0.5% repayment fee Update: 1% performance fee, 0.5% repayment fee
• yv-stETH-ETH: Current: 0.49% performance fee, 0.5% repayment fee Update: 1% performance fee, 0.5% repayment fee
• cvx-stETH-ETH: Current: 0.44% performance fee, 0.5% repayment fee Update: 1% performance fee, 0.5% repayment fee
• CRV: Current: 11% interest Update: 11% interest
• cbETH: Current: 0.81% performance fee, 0.5% repayment fee Update: 1.5% performance fee, 0.5% repayment fee
• stETH: Current: 0.8% performance fee, 0.5% repayment fee Update: 1.5% performance fee, 0.5% repayment fee
• LDO: Current: 4% interest Update: 8% interest

Terms

New vote is required to update these fees

Quorum Standards

The option with the most votes will be adopted.

Options

• Approve proposal
• Further discussions needed
• Abstain