The Ethereum app layer fee proposal is the latest in a slew of developer suggestions to overhaul the economics of the Ethereum network.
Two Ethereum community members, Kevin Owocki and Devansh Mehta, proposed a dynamic fee structure for the Ethereum application layer to strike a balance between revenue generation for app builders and fairness in fee extraction.
The April 27 proposal outlined a simple equation that uses a square root function that proportionally lowers the percentage of fees as the funding capital allocated to a particular project grows. Owocki and Mehta explained:
The authors of the proposal added that fees would be capped at 1% once a particular application’s funding pool crossed the $10 million level, ensuring that small app builders can develop decentralized applications without excess fees while also encouraging project and funding growth by capping fees as developers scale their applications.
