# \[IDEA\] Increase Anchor Protocol transaction fees to support $ANC profit sharing **URL:** \ **Category:** Mechanism\ **Created:** [March 13, 2022, 11:38pm UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458 "2022-03-13T23:38:58Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![dojakron](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@dojakron](https://forum.anchorprotocol.com/u/dojakron)\ **Post date:** [March 13, 2022, 11:38pm UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/1 "2022-03-13T23:38:58Z")
There have been many proposals to increase the utility of ANC through sophisticated changes in borrow and earn mechanics. Might it be more elegant to simply increase the transaction fees in Anchor, and distribute the additional UST to all ANC holders, perhaps by a weekly airdrop?. Transaction fees are paid in UST and are low enough to tolerate a small increase. All anchor protocol users can claw these fees back passively. Augmenting $ANC’s governance utility with passive profit sharing/ yield bearing attributes will give $ANC token holders the recognition/reward they deserve and potentially address $ANC price volatility/ token dumping from the borrow side. Thank you for reading! ---
**Author:** ![narco78](https://avatars.discourse-cdn.com/v4/letter/n/8dc957/32.png) [@narco78](https://forum.anchorprotocol.com/u/narco78)\ **Post date:** [March 14, 2022, 1:14am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/2 "2022-03-14T01:14:57Z")
> [@dojakron](#): > > Might it be more elegant to simply increase the transaction fees in Anchor, and distribute the additional UST to all ANC holders, perhaps by a weekly airdrop?. Yes, a 0.5% withdrawal fee is a simple, clean and fair solution. However, why not use this fee to purchase the ANC directly off market and redirect the ANC tokens back to the protocol? Those tokens can be used to perpetuate borrowing support after emissions end or even form part of a formal compensation fund for technical issues. This would achieve the objective of providing price support to the ANC token, reducing supply and serve long term benefits to the protocol. Is anyone able to run the stats on the Earn withdrawal data so we can crunch the numbers? ---
**Author:** ![dojakron](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@dojakron](https://forum.anchorprotocol.com/u/dojakron)\ **Post date:** [March 14, 2022, 4:54am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/3 "2022-03-14T04:54:59Z")
buybacks that increase the floor price of $ANC still mean that $ANC must be sold to realise economic benefit from increase in value. i feel that $ANC should be dividend bearing/profit sharing such as to reward hodling. this will possibly also alleviate governance situations where people have to purchase $anc to repeal peculiar proposals, only to be beset with token price dumping after locked $ANC is released. ---
**Author:** ![narco78](https://avatars.discourse-cdn.com/v4/letter/n/8dc957/32.png) [@narco78](https://forum.anchorprotocol.com/u/narco78)\ **Post date:** [March 14, 2022, 6:03am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/4 "2022-03-14T06:03:55Z")
> [@dojakron](#): > > buybacks that increase the floor price of $ANC still mean that $ANC must be sold to realise economic benefit from increase in value. Not if those ANC are redirected back to the protocol. This actually reduces circulating supply as they would not be immediately resold back to the market. My suggestion is that protocol purchased ANC should be used a later date to support borrowing after emissions end. ---
**Author:** ![chrisgilbert](https://avatars.discourse-cdn.com/v4/letter/c/e47c2d/32.png) [@chrisgilbert](https://forum.anchorprotocol.com/u/chrisgilbert)\ **Post date:** [March 14, 2022, 6:15am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/5 "2022-03-14T06:15:56Z")
This could be a good idea. I don’t believe we have to choose only one solution between one that affect the borrow or the earn mechanics. Any solutions that improves the mechanism should be considered as long as simple to understand and to implement. Like with any products and services, its only a matter of time before we add solutions that will improves the protocol incomes and link it more to his ANC token. The HODLERs will then be rewarded. ---
**Author:** ![Lefty](https://avatars.discourse-cdn.com/v4/letter/l/85e7bf/32.png) [@Lefty](https://forum.anchorprotocol.com/u/Lefty)\ **Post date:** [March 14, 2022, 8:45am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/6 "2022-03-14T08:45:38Z")
Deposit fees would be better than withdrawal fees, because it would limit the endless degen looping. I’d be inclined to agree with withdrawal fees if it was distributed to Yield reserves ---
**Author:** ![WellPlay](https://sea2.discourse-cdn.com/flex016/user_avatar/forum.anchorprotocol.com/wellplay/32/939_2.png) [@WellPlay](https://forum.anchorprotocol.com/u/WellPlay)\ **Post date:** [March 14, 2022, 11:31am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/7 "2022-03-14T11:31:14Z")
That is genuis , well balanced ---
**Author:** ![bitn8](https://sea2.discourse-cdn.com/flex016/user_avatar/forum.anchorprotocol.com/bitn8/32/61_2.png) [@bitn8](https://forum.anchorprotocol.com/u/bitn8)\ **Post date:** [March 15, 2022, 12:30am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/8 "2022-03-15T00:30:28Z")
The borrow and earn functions on the app should be dead simple. Increasing fees isn’t a very simple or great user experience. If fees were to be applied, the withdrawal fee where x% is used to buy and burn ANC would be the best worst case of this. ---
**Author:** ![Mleca85](https://avatars.discourse-cdn.com/v4/letter/m/6f9a4e/32.png) [@Mleca85](https://forum.anchorprotocol.com/u/Mleca85)\ **Post date:** [March 15, 2022, 2:01am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/9 "2022-03-15T02:01:45Z")
Incrising deposit fees or withdraw is useless. If i deposit 1 mil do you think it will affect my when i take 200k each year :)) how much i will pay 1k 2k ok i will gift that :)) ---
**Author:** ![dojakron](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@dojakron](https://forum.anchorprotocol.com/u/dojakron)\ **Post date:** [March 15, 2022, 2:14am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/10 "2022-03-15T02:14:53Z")
> [@bitn8](#): > > Increasing fees isn’t a very simple or great user experience the problem we are trying to solve is $ANC dumping from the borrow side. my take is that a slight flat fee increase for each and every transaction is far simpler and tolerable than the staggered interest rates based on $ANC holdings, which are even worse experiences for the entire community, since those can be gamed. ---
**Author:** ![dojakron](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@dojakron](https://forum.anchorprotocol.com/u/dojakron)\ **Post date:** [March 15, 2022, 2:21am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/11 "2022-03-15T02:21:40Z")
> [@Mleca85](#): > > how much i will pay 1k 2k ok i will gift that :)) the beauty of the suggestion is that it doesn’t have to touch the earn side or borrow side mechanics. the earn side remains flat 19.x% and all m capabilities of anchor are intact. for reference, autocompounders like beefy also have slight entry and exit fees. everything is tolerable because it’s a passive stablecoin strategy. the fee can be flat rather than a percentage of the amount transacted. the objective is to encourage $ANC hodlers so as to ensure strong governance that can repeal weird proposals like Prop 18 (which would have reduced your $1M APR by half if it was passed). ---
**Author:** ![Mleca85](https://avatars.discourse-cdn.com/v4/letter/m/6f9a4e/32.png) [@Mleca85](https://forum.anchorprotocol.com/u/Mleca85)\ **Post date:** [March 15, 2022, 2:45am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/12 "2022-03-15T02:45:30Z")
![Screenshot_20220315-034318_Binance](https://us1.discourse-cdn.com/flex016/uploads/anchor/original/1X/b79f10c19ddbc27e2553937ad6853fa6294e3711.jpeg) If binance can do this then so anchor. And this will fix everything. ---
**Author:** ![Mleca85](https://avatars.discourse-cdn.com/v4/letter/m/6f9a4e/32.png) [@Mleca85](https://forum.anchorprotocol.com/u/Mleca85)\ **Post date:** [March 15, 2022, 2:46am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/13 "2022-03-15T02:46:11Z")
Yeah not the same rates but you get the idea ---
**Author:** ![dojakron](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@dojakron](https://forum.anchorprotocol.com/u/dojakron)\ **Post date:** [March 15, 2022, 2:52am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/14 "2022-03-15T02:52:33Z")
it won’t work as well in defi since people can create unlimited accounts to earn at the most lucrative tier. and to bring us all back to focus the problem we were trying to solve in this thread was trying to fix the $ANC tokenomics so we have stronger governance:) ---
**Author:** ![Mleca85](https://avatars.discourse-cdn.com/v4/letter/m/6f9a4e/32.png) [@Mleca85](https://forum.anchorprotocol.com/u/Mleca85)\ **Post date:** [March 15, 2022, 2:54am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/15 "2022-03-15T02:54:29Z")
And yeah i understand the prop 18. But how can you take out the protocols that are built on top of anchor like inkprotocol, loterra, and so many others… including whales that have milions of ust in anchor protocol? If you are like me working for 2,5k€ / how do you same and earn money on top of what you have if each 3 4 month will have the same problem = yield reserve 0 ---
**Author:** ![Mleca85](https://avatars.discourse-cdn.com/v4/letter/m/6f9a4e/32.png) [@Mleca85](https://forum.anchorprotocol.com/u/Mleca85)\ **Post date:** [March 15, 2022, 2:57am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/16 "2022-03-15T02:57:10Z")
Inkprotocol is taking 100k each week for ex so what stability do you want for anchor when more money are going out then in? :)) ---
**Author:** ![dojakron](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@dojakron](https://forum.anchorprotocol.com/u/dojakron)\ **Post date:** [March 15, 2022, 3:05am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/17 "2022-03-15T03:05:00Z")
> [@Mleca85](#): > > But how can you take out the protocols that are built on top of anchor like inkprotocol, loterra, and so many others so my suggestion was a small transaction fee every time anchor protocol was interacted with, to bring up the floor price of $ANC or to incentivise $ANC hodlers. objective is to have a ready pool of people to govern $ANC protocol. it shouldn’t make a difference if it was from by someone logged on anchor or through any of the apps that you had mentioned. ---
**Author:** ![dojakron](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@dojakron](https://forum.anchorprotocol.com/u/dojakron)\ **Post date:** [March 15, 2022, 3:16am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/18 "2022-03-15T03:16:32Z")
> [@Mleca85](#): > > Inkprotocol is taking 100k each week for ex that’s more an earn side tokenomics challenge rather than an $ANC governance challenge. of course helpful if there were means of solving both challenges in one simple move. we can discuss. ---
**Author:** ![dojakron](https://avatars.discourse-cdn.com/v4/letter/d/edb3f5/32.png) [@dojakron](https://forum.anchorprotocol.com/u/dojakron)\ **Post date:** [March 15, 2022, 5:34am UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/19 "2022-03-15T05:34:49Z")
> [@WellPlay](#): > > That is genuis , well balanced let’s have someone make the proposal if it makes sense? i’ll put my $ANC behind it ---
**Author:** ![Jerry](https://sea2.discourse-cdn.com/flex016/user_avatar/forum.anchorprotocol.com/jerry/32/949_2.png) [@Jerry](https://forum.anchorprotocol.com/u/Jerry)\ **Post date:** [March 15, 2022, 2:04pm UTC](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458/20 "2022-03-15T14:04:08Z")
It seems like a good idea. It would be nice to have a concrete proposal. [Next page](https://forum.anchorprotocol.com/t/idea-increase-anchor-protocol-transaction-fees-to-support-anc-profit-sharing/3458.md?page=2)