In addition to liquidity mining, Osmosis provides three sources of revenue: transaction fees, swap fees, and exit fees.

TX Fees

Transaction fees are paid by any user to post a transaction on the chain. The fee amount is determined by the computation and storage costs of the transaction. Minimum gas costs are determined by the proposer of a block in which the transaction is included. This transaction fee is distributed to OSMO stakers on the network.

Validators can choose which assets to accept for fees in the blocks that they propose. This optionality is a unique feature of Osmosis.

Swap Fees

Swap fees are fees charged for making a swap in an LP pool. The fee is paid by the trader in the form of the input asset. Pool creators specify the swap fee when establishing the pool. The total fee for a particular trade is calculated as percentage of swap size. Fees are added to the pool, effectively resulting in pro-rata distribution to LPs proportional to their share of the total pool.

Exit Fees

Osmosis LPs pay a small fee when withdrawing from the pool. Similar to swap fees, exit fees per pool are set by the pool creator.

Exit fees are paid in LP tokens. Users withdraw their tokens, minus a percent for the exit fee. These LP shares are burned, resulting in pro-rata distribution to remaining LPs.

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