Why 340 Ada min fee is not being reduced

Staking & Delegation Operate a Stake Pool
25

Hello @Oroborus

Here is a research paper from 2020 that talks about such fees:

I’m not aware of any scientific paper that was published talking negatively about this fee. Can you post a link to which papers you are referring to please.

The term ‘fix fee’ is not used by researchers. This is just the name that coders gave it. Research papers usually refer to these things in proof oriented way such as:
formula

When you hear things such as ‘fixed fee’ or minPoolCost that is usually dev talk.

There are over 100+ research papers available for public viewing here:

Reason for having this fixed was to implement research done trough Ouroboros research papers from 2018 to 2020 (you can find all of them in the link above).

Research pointed out that there must be:

  1. A fee for pool operators to cover the cost
  2. A fraction of reward as profit margin to pool operators
  3. A way to dis-incentivize a type of Sybil attack that creates large amount of empty pools

What developers did is to create a fixed fee which address points 1. and 3. , while they created pool margin fee to address point 2.

There was a talk of making a margin fixed above zero, but that approach seems to go against research.

Further more the research pointed out that if fair reward scheme was implemented this would 100% lead to centralization of the whole system. So arguments to remove ‘Fixed fee’ for basis of fair reward scheme were already disproven.

This was very clear in the research paper I linked above. Here is what research found happens to fair reward schemes over 100 iterations:
FRSS
Always leads to centralization.

The amount of 340 ADA was chosen in summer of 2020 when ADA was moving between $0.08 and $0.12, so I can definitely see why many people want this drastically reduced (or removed). If we use price of ADA as a guide this fee should be between 65 and 100 ADA.

Yes there can be a vote to change the amount of fixed fee.

There was no community on the beginning. All crypto projects start centralized with their creators and slowly become decentralized as they build out (if decentralization is the goal).

Hope this helps :smiley:

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