IIP-161: Reduce MNYe Fees

IIP: 161
Title: Reduce MNYe Fees
Status: Proposed
Author: @kindeagle
Reviewer: @funkmasterflex @afromac

Date: 11/07/2022


Simple Summary

This proposal presents the opportunity to INDEX holders to reduce the MNYe Redeem fee from 30bps to 0bps

Abstract

The current fee structure of MNYe is as shown below:

Streaming Fee: 95bps
Mint Fee: 0bps
Redeem Fee: 30bps

After additional market research and collecting feedback from core customer categories, we would like to propose that each of these fees be reduced to…

Streaming Fee: 95bps
Mint Fee: 0bps
Redeem Fee: 0bps

Reducing these fees will lead to a better user experience whereby users don’t forgo weeks/months of accrued yield when redeeming the MNYe position.

Motivation

Market research has indicated one of the largest barriers to purchasing our products at size is the redeem fees. This proposal removes the redeem fee and will enable the product to more accurately track the Net Asset Value (NAV) as arbitrage traders do not need to allow for the redeem fee upon interacting with the exchange issuance module.

After further market validation, we believe that reducing the redeem fee will have a positive impact on N$F from large buyers and protocol integrations. Large buyers, whether whales, hedge funds, DAOs, or asset managers have shown pushback on the mint/redeem fees and the effect of the fee on product yield.

Specification

MNYe fees will be amended to reflect the below. This change will be implemented by @edwardk’s team shortly after the proposal passes a community snapshot vote.

Streaming Fee: 95bps
Mint Fee: 0bps
Redeem Fee: 0bps

Voting

FOR: Eliminate 30 basis points Redeem Fee for MYNe in accordance with the specification.

AGAINST: Make no change to MNYe fee structure.

Copyright

Copyright and related rights waived via CC0 .

9 Likes

Fully in favor of this fee change!

1 Like

This vote is schedule to begin in 24 hours:
https://snapshot.org/#/index-coop.eth/proposal/0x3b1d743548666a492181daacf904a78f90076477add66ab880362b544bd4a8e4

1 Like

This vote has successfully passed and the redeem fee will be eliminated for MNYe.

2 Likes

Upon further investigation, updating the redemption fee will require more engineering effort than expected. As a result, we will proceed with the MNYe launch with the original redeem fee in place (30bps) and eliminate the fee as soon as possible after launch.

2 Likes