The MLP also doubles as an spot AMM, allowing traders to swap between any two assets in the pool (including stablecoins). These trades are executed at the oracle price (plus or minus a spread on longtail assets). In addition, there is a trading fee.
The spot trading fees will vary depending on the assets being swapped. Low fees will be used to incentivise trades that cause productive assets to be deposited and unproductive assets to be withdrawn. Thus, traders would rather trade that pair on Mycelium in comparison to another DEX.
In contrast, there will be a high fee on trades that cause unproductive assets to be deposited and productive assets to be withdrawn, making traders rather trade that pair on another DEX. This will move the allocation of assets across liquidity pools to the optimal levels.
- The base fee for a trade including a non-stable asset starts at 0.2%.
- The base fee for a stable to stable asset swap is 0.03%.
- The spot swap fee sensitivity parameter is 0.4%