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Fees in Mean Finance are quite simple. We can divide them into two categories: gas fees and protocol fees.
Users only need to pay gas fees when they interact with their positions. This includes:
- Creating their position
- Modifying their position
- Withdrawing their swapped balance
- Terminating their position
- Giving or revoking permissions
When users interact with their positions, no protocol fee is charged. Protocol fees are collected only on swaps. When a swap is executed, a protocol fee is collected from all users involved in that swap. As of now, that fee is 0.6%.
Let's try with an example using John's position:
- Rate: 5 DAI
- Swap interval: daily
- Amount of swaps: 365
Let's assume that 4 swaps were executed, where 5 DAI = 1 ETH for all swaps. Now, John's swapped balance at the end of the forth swap would be 4 ETH. But, taking into account the protocol fee, it would actually be
4 - 0.6% = 3.976
It is important to mention that if John were to terminate the position at this point, he would get back:
- The DAI what wasn't swapped: 361 * 5 = 1805 DAI
- The ETH that was swapped: 3.976 ETH
See that no fee was charged from the balance that remained un-swapped.