Mango fee bypass mechanism

Hey everyone

May aswell get this written down while I am in the mood.

Some of you will be aware that Mango as a project is proactively trying to bypass and undermine a key feature of how Serum is set up, the fee utility for holding Srm.

I dont want to talk about who/how/why/fair, what I do want to talk about is there a constructive riposte we as the Serum community can come up with to try and protect this key utility.

Does anybody have any ideas?

Mango currently sends 80m in volume to Serum dex per week. I think much of that is because of the fee reductions but also much of it is because of their amazing UI. Mango also doesn’t totally bypass the need to buy and hold SRM. Deposit rates for SRM are fairly high because they need to have excess SRM to get the fee discounts. I hold a decent amount of SRM as well and I think Mango is net positive for SRM token value.

Mango wants a msrm under their custody to pass the fee savings onto all of its users. Did I get that wrong?

Agree the UI is amazing!

Yes that’s correct. But having a community with good marketing and good UI devs shilling serum is probably net positive for SRM token value even after you account for reduced fees.

I think the way to win is to get everyone integrated into Serum and give people little reason to use a different platform. Fees are a big part of that.

I think the way Serum wins is the token retains as much utility as possible and fee discounts for holding is part of it.

The role and value of MSRM is a topic for another thread, but do you accept that if Mango keeps this mechanic it undermines Serum?

I guess its for Mango to make the plausible argument the net EV is +ve.

I also accept this is defi baby, composable,freedom blah blah.

Fee discount based on token ownership is a mechanic that creates a barrier of entry for smaller players through unnecessarily benefiting large players. Serum should just stop this predatory cefi practice, don’t know of any other top 10 defi protocol that has this mechanic.

2 Likes

Ok do I think both replies received so far have been from the Mango bois. Do either of you have suggestions of what Srm could do to add utility to the project you have part built on that is not predatory in your eyes.

You raised 70m in a IDO so spare me too much protestation about such behaviour, all projects have to have their levers to exist.

lol it actually happened. with one single action, the largest utility of the SRM token is bypassed, by a team that built on Serum and recently raised $70m in an IDO. I must be taking crazy pills. good luck, its like reverse diplomacy

I generally support what Mango is doing. The program allows it, and they aren’t hurting others, and so it’s fair game. They are giving their users the best experience, and I believe they are positive EV and general role models for the community. I also don’t particularly think it’s productive to call this predatory.

What can be done, in theory at least, is to eliminate the ability for other programs to get fee discounts like this by requiring the owner of the open orders account to not be a PDA. Though there might be some lower level changes to the solana SDK to facilitate this change.

5 Likes

yes it is fair game, I guess its up to Serum to be proactive to maintain as much utility as possible, while abiding by defi vibes