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Service Fee

When liquidity providers (LPs) wish to exit the market as market makers and remove the corresponding liquidity, our platform will levy reasonable service fees. This portion of the fees is exclusively aimed at LPs and will be partially reimbursed to liquidity pool creators based on the platform's operational conditions. The remaining portion will serve as platform revenue to support long-term development.

  1. Entities subject to the fee: LPs

  2. Timing of the fee collection: Upon LPs' removal of liquidity

  3. Fee base: Liquidity removed by LPs and any associated profits

  4. Fee rate: Initially, it will be relatively low, or even waived, and subsequently determined by platform governance.


Service Fee rate imposed consists of two parts, base fee rate rb{r}_{b} and profit fee rate rp{r}_{p} . rp{r}_{p}is slightly higher than rb{r}_{b}, with the formula of total service fee calculated as below:


fs=removal×rb+profit×rp{f}_{s}=removal\times{r}_{b}+profit\times{r}_{p}

For example:
Base fee rate rb{r}_{b}=0.01%, Profit fee rate rp{r}_{p}=10%. For a market maker removing a 10,100 USDC amount of liquidity, with the initial balance of which being 10,000 USDC, and returns being 100 USDC, then the service fee charged will be:


ServiceFee=10100×0.01%+100×10%=11.01ServiceFee=10100\times 0.01\% +100\times 10\% =11.01

Initially, base fee rate rb and profit fee rate rp will be relatively low with slight adjustments made according to the platform’s development state. Upon the establishment of Jungle DAO, they will be subsequently determined by community governance.