Comment on page
In OXCHANGE v1 and v2, every pair of tokens corresponds to a single liquidity pool, which applies a uniform fee of 0.30% to all swaps. While this default fee tier historically worked well enough for many tokens, it is likely too high for some pools (such as pools between two stablecoins), and too low for others (such as pools that include highly volatile or rarely traded tokens).
OXCHANGE v3 introduces multiple pools for each pair of tokens, each with a different swap fee. All pools are created by the same factory contract. The factory contract initially allows pools to be created at three fee tiers: 0.05%, 0.30%, and 1%. Additional fee tiers can be enabled by OXCHANGE governance.
Non-Compounding Fees. Fees earned in earlier versions were continuously deposited in the pool as liquidity. This meant that liquidity in the pool would grow over time, even without explicit deposits, and that fee earnings compounded.
In OXCHANGE v3, due to the non-fungible nature of positions, this is no longer possible. Instead, fee earnings are stored separately and held as the tokens in which the fees are paid.
Removal of Native Liquidity Tokens. In v1 and v2, the pool contract is also an ERC-20 token contract, whose tokens represent liquidity held in the pool. While this is convenient, it actually sits uneasily with the v2 philosophy that anything that does not need to be in the core contracts should be in the periphery, and blessing one “canonical" ERC-20 implementation discourages the creation of improved ERC-20 token wrappers. Arguably, the ERC-20 token implementation should have been in the periphery, as a wrapper on a single liquidity position in the core contract.
The changes made in OXCHANGE v3 force this issue by making completely fungible liquidity tokens impossible. Due to the custom liquidity provision feature, fees are now collected and held by the pool as individual tokens, rather than automatically reinvested as liquidity in the pool.
As a result, in v3, the pool contract does not implement the ERC-20 standard. Anyone can create an ERC-20 token contract in the periphery that makes a liquidity position more fungible, but it will have to have additional logic to handle distribution of, or reinvestment of, collected fees. Alternatively, anyone could create a periphery contract that wraps an individual liquidity position (including collected fees) in an ERC-721 non-fungible token.