Here’s a thread I posted on Twitter regarding only removing the min fee:
While I do think that ultimately the min fee must be removed, I think under current network conditions removing it would be ineffective and may even further hurt small pools. Here’s why:
Remove the min fee now and small pools will be forced to lower their fixed fee to zero to compete with other small pools. But with no change in k, delegations likely still won’t move and small pools don’t get anymore delegators, they just become less profitable.
The unfortunate truth is that small pools compete for the same group of delegators. Multipool delegators are a different group. If we want to move delegations from multipools to single pools, we must also increase k and oversaturate large multipools.
Increasing k will incentivize delegations to move and many delegators may reconsider their delegation. Furthermore, increasing k will force multipools to split pledge if they want the same leverage. So the resulting pools will be less attractive.
Add a fair pledge benefit (the current pledge benefit penalizes small pools) and decrease a0 to increase public pool rewards, and the network is much more egalitarian.
If you like these changes, this is CIP-75 Fair Stakepool Rewards.
I believe that we should thoughtfully change multiple parameters to find a better equilibrium point for delegations. Changing ONLY the min fee will not help much, imo. The damage of the min fee is already done.
We must change other parameters as well to undo the damage.
End of thread.
https://twitter.com/TobiasFancee/status/1583860527410728960?s=20&t=WmauWAk7njz7ig0YPzR-CA
So while I do believe the min fee should eventually be removed, I also think we should at least increase k as well to get delegations moving. I believe the changes I propose in CIP-75 would be the best option long-term (start at fairness and let the free market do the rest). In regards to CIP-69 (only removing min fee), the big question for small stakepools is: how many delegators are out there that aren’t delegated to you simply because of lower rewards? How many delegators will actually move from multipools to small pools if the min fee is removed? There are many stagnant delegations in multipools that simply will not move unless k is increased. Anyway that’s my 2 cents. If CIP-69 does go through, I think it should be reduced like d was epoch by epoch to reduce shock to the network.