💵Fee

Minimize LVR with Fee Intents on A51 Carbon

Utilizing the fee intents on Carbon, LPs can effectively reduce the LVR as a result of drastic market swings.

Uniswap V4 allows the setting of arbitrary fee percentages. With Carbon, you can set the amount of fee charged for a swap.

Intents available here are:

  1. Static Fees: A fixed fee is charged each time a swap is processed.

  2. Dynamic Fees: Fee is based on the volatility of the market rewarding LPs with more fees and reducing LVR.

    1. Min fees: The lowest swap fee. This fee is applied when the pool price is at the TWAP.

    2. Max fees: The highest swap fee. This fee applies when the pool price deviates significantly from the TWAP.

    3. Quadratic multiplier: Adjust how quickly the swap fee increases as the price deviates from TWAP. Higher values make the fee more responsive to price changes.

    4. TWAP duration: The time window for querying the Time-Weighted Average Price (TWAP) used during fee calculation. Smaller values avoid charging overly high swap fees for long but are worse at capturing fees from longer-term volatility.

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