💰Fees
An overview of the trading and sequencer fees charged on Blitz.
Trading Fee Model
Trading fees are a standard feature of any exchange venue. Fee models vary between exchanges but are generally charged:
As a percentage of the total value of a trade.
Each time an order is executed.
On a decentralized exchange (DEX), trading fees serve several core functions, including:
Generating protocol revenue.
Providing an economic incentive for market makers to provide liquidity.
Modulating speculation and manipulation of specific trading pairs.
As a hybrid orderbook-AMM DEX with an integrated money market, Blitz’s fee model applies to:
AMM Liquidity Pools
Borrow / Lend Pools
The Sequencer's Central-Limit Orderbook
As a result, the four primary market participants on Blitz with an impact from fees include:
Price Makers
Price Takers
Liquidity Providers (LPs)
Borrowers & Lenders
Each specific market participant is defined below within the context of Blitz’s fee model.
Price Makers: Makers provide liquidity to the protocol by placing resting limit orders (e.g., bids and asks) on Blitz’s orderbook.
Makers augment the liquidity of an exchange and play a critical role in minimizing spreads and slippage by providing liquidity to takers.
Price Takers: Takers remove liquidity from the orderbook by buying and selling assets via market orders.
Takers remove liquidity from the exchange by crossing the spread and accepting liquidity as offered by price makers.
Liquidity Providers: Commonly known as LPs, liquidity providers are the suppliers of liquidity in Blitz’s AMM asset pools (e.g., ETH / USDB), deploying an equivalent USD value of each asset in the pool’s trading pair to earn a proportional percentage of the pool’s trading fees as revenue.
LPs are subject to impermanent loss (IL), where volatility in an asset’s price in a given liquidity pool causes an LP’s proportional share of the liquidity pool to be worth less than the present value of their deposited assets into the pool.
Borrowers & Lenders: Asset pools for borrowing and lending on Blitz’s money market comprise debtors (borrowers) and creditors (depositors) for a given spot asset.
Depositors are the liquidity providers to the pool, earning a proportional share of the prevailing interest rates borrowers pay.
The money market enables borrowing/lending for a specific asset at the prevailing interest rate in the pool – with interest rates a function of both the demand to borrow and the liquidity of the asset pool.
Trading Incentives
Price Makers, LPs, and Lenders occupy a special class of users: supplying Blitz with liquidity. While providing liquidity, they take on particular risks – such as impermanent loss (IL) for LPs or capital and opportunity costs for Price Makers and Lenders.
To enable cheap and efficient trading for users in the greatest volume possible, Blitz aims to promote liquidity, defined as:
Tight Spreads
Low Slippage
Price Makers, LPs, and Lenders deliver value to Blitz by contributing liquidity to the protocol and enabling lower costs for price takers. Blitz will promote stronger incentives for these liquidity providers to maximize the DEX’s effectiveness as an exchange venue.
Below, we categorize the trading fee model on Blitz, which includes:
A competitive maker / taker fee model.
Points & BLAST token incentives.
Trading Fees & Rebates
High fees typically characterize most decentralized exchanges.
Blitz is built different.
Blitz's trading fee model is competitive with centralized crypto exchange venues – offering cheap trading for takers and zero fees for makers across all markets for both spot and perpetuals.
Maker Fee = 0 bps across all markets.
Taker Fee = 2 bps across all markets.
Specific to Blitz’s orderbook, the maker / taker trading fee model is displayed below.
Taker Fee Structure
Minimum Taker Fee: Upon matching, every taker order is subject to an immediate fee. This fee is calculated based on the formula:
minSize × maker.price × feeRate .No Fees Interval: For the initial part of the order, specifically
[0, minSize), there are no fees charged.Standard Fee: For any portion of the order amount that exceeds
minSize, a standard fee is charged based on the formula:quoteAmount × feeRate.
Blitz’s trading fee structure is supplemented by the Blitz Maker Program, a rebate-based trading fee incentive program for price makers.
Details on the Blitz Maker Program and Blitz Points + BLAST incentives will be released soon. Early depositors and traders on Blitz will accrue Blitz Points retroactively for their early activity on the Blitz app.
Sequencer Fees & Denomination
All trading fees on Blitz are paid in USDB.
Initially, all trading pairs on Blitz will be denominated in USDB – such as wETH / USDB for spot and the BTC-PERP.
Sequencer Fees
Blitz charges a flat fee for interactions with the off-chain Sequencer, Vertex Edge.
Sequencer fees are denominated in USDB, and used to subsidize the gas fees paid to the underlying blockchain, Blast, while allowing for a faster trading experience via blazing-fast order matching.
The sequencer interacts with the underlying blockchain, Blast, matching inbound orders into the protocol. But it also serves as the route for other high-speed interactions such as rapid deposits, withdraws, LP minting, and more.
For more details on the sequencer, please refer to the documentation section on Vertex Edge here.
Of note, sequencer fees are approximate values for withdraws and deposits denominated in the corresponding asset. Fees are subject to change over time as gas fees and other variables are adjusted, but they should remain relatively stable within months of launch.
The sequencer fees on Blitz are as follows:
Deposit = 0 USDB
Submitting a Liquidation = 1 USDB
Withdrawing Collateral:
wETH = 0.0006 wETH
USDB = 1 USDB
Placing an Order that Takes Liquidity from the Book = 0 USDB***
Minting / Burning LP Tokens = 1 USDB
***Placing an Order that Takes Liquidity from the Book: Limit orders and takers aren't mutually exclusive, so sequencer fees may still apply to specific limit orders.
For example, a trader might place a limit order that does not immediately match any existing orders, adding liquidity to the market.
Later, the same trader might execute a market order or a limit order that matches an existing order, taking liquidity and acting as a taker that is charged a sequencer fee.
Sequencer fees are only charged if the operation is successful. For example, if you submit a collateral withdrawal request that causes your account to be under-collateralized, you will not be charged fees for the failed action.
If you don’t have USDB in your subaccount, either a loan will be taken out or the transaction will fail, depending on whether spot leverage is enabled.
Gas Fees
The Vertex Edge sequencer handles user interactions with the blockchain -- Blast.
As a result, users' sequencer fees are paid in lieu of gas on Blitz and are akin to some combination of gas and “clearing fees” on a traditional exchange.
Withdrawals
Blitz minimizes user fees by sending transactions on Blast when gas fees are low.
All actions on Blitz still happen instantaneously, but withdrawals can take up to 30 minutes or longer during high gas periods.
The 30-minute time-frame is the targeted maximum that a withdrawal will remain pending, as Blitz usually sends the transaction to Blast after this time automatically -- even during high gas periods.
If your withdrawal takes longer, it may be due to persistent and excessively high gas costs.
NOTE -- If your withdrawal appears on the Blitz app, that means it was successfully placed and will settle on-chain once gas costs come down or if gas is already below the target threshold at the time of your withdrawal.
Please note that withdrawal times may still be variable as the automated mechanism is optimized to account for dynamic changes in gas costs on a new L2 mainnet network -- Blast.
To track withdrawals' status, visit the Portfolio page's Account History section.
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