Payout thresholds adjusted

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Steve Sokolowski
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Joined: Wed Aug 27, 2014 3:27 pm
Location: State College, PA

Payout thresholds adjusted

Post by Steve Sokolowski » Thu Aug 06, 2020 9:28 am

Yesterday, Chris reviewed the system's payouts as part of his periodic audits to see where most of our costs lie. He discovered that the transaction fees had changed significantly from their previous values, which were entered last year.

We target the free payout threshold so that no more than 25% of our profit is lost to the coin network transaction fees. Since our profit is 3.99%, the free payout threshold is set to 100 times the average network transaction fee.

While some coins saw lower fees, many Ethereum token fees have significantly increased since December. There are three factors that seem to have driven up the cost of these payouts, some of which have risen to $5 per payout:
  • The complexity of newer contracts is higher, resulting in more gas costs to process the payouts
  • The Ethereum network is very congested, causing gas price increases
  • Most significantly, the price of Ethereum has skyrocketed, and buying Ethereum to pay the fees has become expensive
We expect to have to continue to raise the thresholds for Ethereum-based tokens. While most contracts aren't being changed after release, and the Ethereum network has been at maximum capacity for some time, customers should unfortunately expect for the thresholds to rise if Ethereum's price continues to increase.

If you're willing to lose some of your earnings to the gas costs, you can be paid more frequently if you'd like by lowering the payout threshold to the minimum transaction amount. The minimum transaction amount, however, is also increasing. The minimum is always set to twice the average transaction fee, since it costs us half the money to send it to you, and then you would have to spend the other half in fees just to move it out of the receive address, leaving nothing left when you want to spend it.

If the price of Ethereum falls, we'll lower the thresholds as soon as we can.
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