# Fees

DerpDEX charges a small fee on each trade, which is proportionally distributed among liquidity providers. The fee is typically a fraction of the trade value and serves as an incentive for users to provide liquidity. By participating in liquidity provision, users can earn passive income while supporting the ecosystem.

## Flexible Fees

This new feature enables flexibility when it comes to trading fees. Instead of offering the standard 0.3% trading fee known from AMM, DerpDEX initially offers 4 separate fee tiers; 

1. 0.01% for extremely proven stablepairs, 
2. 0.05% for most of stablecoins, 
3. 0.3% for most cryptocurrencies such as ETH,
4. 1% for more exotics cryptocurrencies that degens don't mind the trading fees. 

This allows LPs to choose the pools according to the risk they are willing to take. The recommendation would be the 0.05% fee to be predominantly used for pools with similar assets such as different stable coins, 0.3% for other standard pairs like ETH/USDC and 1% for more exotic pairs.

## Fees distribution 

Shares of protocol earnings are distributed as indicated below:

1. [Stablecoin pairs](https://derpdex.gitbook.io/home/protocol/fees/stablecoins)
2. [Other cryptocurrencies](https://derpdex.gitbook.io/home/protocol/fees/other-cryptocurrencies)