ClankerHookDynamicFee

​

User Controlled Configuration Variables

struct PoolDynamicConfigVars {
    uint24 baseFee; // the minimum LP fee to be taken on a swap
    uint24 maxLpFee; // the maximum LP fee to be taken on a swap
    uint256 referenceTickFilterPeriod; 
    uint256 resetPeriod;
    int24 resetTickFilter;
    uint256 feeControlNumerator; // the denominator is set to 10_000_000_000
    uint24 decayFilterBps;
}

IClankerHookDynamicFee.PoolDynamicConfigVars({
    baseFee: 5000,// 0.5% minimum fee
    maxLpFee: 50000, // 5% max fee
    referenceTickFilterPeriod: 30 seconds,
    resetPeriod: 120 seconds,
    resetTickFilter: 200, // 2% price movement
    feeControlNumerator: 500000000, // Constant for scaling variable fee component
    decayFilterBps: 7500 // 75% decay after filter period
})

​

Dynamic Fee Calculation

uint24 dynamicFee = 
  MIN(
      (baseFee + (feeControlNumerator * (volatilityAccumulator ** 2)) / FEE_CONTROL_DENOMINATOR),
      maxLpFee
  );

volatilityAccumulator = |afterTick - referenceTick| + prevVR;

• referenceTick: When the referenceTickFilterPeriod has passed or if a resetPeriod has been triggered with a failing reset condition, this tick value is updated to the beforeTick of a swap. This tick value is kept the same until hitting one of these update conditions.
• resetTick: This tick is updated to the beforeTick of a swap when the referenceTick is updated, and is additionally updated when the resetPeriod has passed and a swap’s beforeTick is at least resetTickFilter ticks away from the resetTick (a passing reset condition).

• referenceTickFilterPeriod: If the previous swap was less than referenceTickFilterPeriod seconds away, we use the recorded referenceTick for the dynamic fee calculation instead of the beforeTick of the current swap. This prevents bots from avoiding the dynamic fee by cutting their swap into smaller swaps.
• resetPeriod: If a referenceTick has not been updated for over resetPeriod seconds, we want to ensure that there is true volatility happening on the pool. The goal is to prevent bots from keeping the pool’s fee high by sending in micro swaps to avoid updating the referenceTick. If the resetPeriod has passed and the beforeTick’s difference from the recorded resetTick is smaller than the resetTickFilter (a failing reset condition), we update both the referenceTick and resetTick to the beforeTick of the current swap to clear out the stored volatility. If the resetPeriod has passed and the beforeTick’s difference from the recorded resetTick is larger than the resetTickFilter (a passing reset condition), we only update the resetTick to the beforeTick of the current swap and keep the referenceTick the same.