If you’re building a serious business in Web3, focusing solely on offering users the “best price” with swaps isn’t enough. You have to think about how swaps fit into your business holistically, from security and compliance to business ops and revenue.

Swap fees are one of the most effective monetization methods for driving meaningful revenue in DeFi. Nearly all Web3 applications, from self-custody wallets to portfolio managers, can utilize swaps to bring value to users.

0x Swap API offers Web3 teams low-friction ways to monetize their products by collecting swap fees and trade surplus. Customers have already generated millions of dollars in revenue from the trading activity of their users thanks to 0x’s out-of-the-box swap fee feature.

Now, with 0x v2 you have greater control over which tokens to collect fees in. The option to choose between collecting fees in the buy or sell token increases the number of transactions you're able to collect more stable tokens in by 76% on average, saving you time and money on your journey towards building a sustainable Web3 business.‍

In this article, we’ll explore how Web3 apps are utilizing swaps to monetize, why all monetization isn’t created equal, and take a look at how 0x’s powerful new monetization controls enable you to unlock revenue and control your balance sheet.

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Unlock revenue with swap fees

If you’re building in Web3, at some point your app will need to touch tokens. And nearly all Web3 applications can utilize swaps to bring value to users. 

As products have matured, found product-market fit, and experienced strong user adoption, many have effectively monetized their services. Self-custody wallets, portfolio managers, and DEXs are increasingly implementing swap fees as a key revenue stream.

Swap fees are charged as a set percentage of the swap, i.e. a markup to the trade rate. This fee varies between applications. Thanks to the recent surge in DEX volume, these fees can add up to millions of dollars in revenue.

Metamask generated $418k in daily swap fee revenue on average in March 2024, with revenue peaking at $1 million on March 20. Meanwhile, Uniswap has generated over $9 million in cumulative revenue since the launch of swap fees.

Another low-friction method that applications have begun to monetize with is trade surplus. Trade surplus, also known as positive slippage, occurs when the user ends up receiving more tokens than their quoted amount. 0x doesn’t take trade surplus but instead allows apps to collect this positive slippage.

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Control your balance sheet with 0x v2

Thanks to 0x’s out-of-the-box swap fee feature, customers have already generated millions of dollars in revenue from the trading activity of their users.

Now, with 0x v2, Web3 businesses have greater control over how they collect fees on trades made through their app, including:

• Swap: Buy or sell token
• Gasless: Buy or sell token
• Trade Surplus (i.e. positive slippage): Buy token

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Reduce accounting complexity

The ability to choose which token to collect fees in, either the buy or sell token, enables you to collect more fees in stable assets.

For example, when a user trades USDC → SHIB:

• In v1, you can only collect fees in SHIB (buyToken)
• In v2, you can choose to collect fees in SHIB (buyToken) or USDC (sellToken) 

Collecting more fees in stable assets such as ETH and USDC enables you to reduce exposure to volatile long-tail tokens that can go down 99% before you sell them.

Long-tail tokens, like memecoins, can also create problems when trying to record and track them in your accounting system. High volatility and lack of liquidity make it difficult to accurately price these tokens, creating headaches for finance and ops.

Token pricing data is also expensive. Top token price APIs cost thousands of dollars a month and are still unable to accurately price many long-tail tokens.

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Save on gas

Depending on your volume and token makeup, it could take hours or days to sell fee tokens into stables.

Say goodbye to manually selling tokens for more stable assets, saving your team valuable time and potentially thousands of dollars in gas.

Track revenue

Easily track current and historical revenue generated with in-depth charts and data directly from the 0x Dashboard. 

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Ready to get serious?

0x’s next-gen pricing engine is in open beta! v2 offers the most seamless swap experience at the best all-in prices with optimal trade execution, powerful new monetization features, and enhanced security.

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Source : 0x News - Sep 24, 2024