31 sats \ 6 replies \ @ek 25 Jul \ parent \ on: How does Muun even make money? lightning
Why don't you withdraw from Kraken to Phoenix for free?
I think Muun makes money from transaction fees. So when you send, you pay a higher fee which includes all fees they incurred for you.
In my use case I'm withdrawing thousands worth of USD to my hardware wallet (want large UTXO for future-proofing high fees). In Phoenix, I'd have to pay 1% of that for liquidity. And this 1% liquidity fee would need to be done every time because when you send an L1 from Phoenix this reduces your liquidity (splice-out). So it would be very expensive to use Phoenix on such large transactions (that's not what L2 is for after all)
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because when you send an L1 from Phoenix this reduces your liquidity
You can also swap out and keep your liquidity using boltz.exchange or swap.deezy.io. This method has its own fees though.
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Impressive. Would you mind making a post detailing this workflow? I'm sure many (as me) are not aware of any of this
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This Muun blog post was super informative, as well as this Phoenix blog post.
I don't think this convoluted Kraken -> Muun -> hardware wallet strategy is going to be worth it in the long run. That's because it's exploiting both:
- the fact that Kraken is "too nice" with users who withdraw with Lightning (they should have a small % L2 fee like everyone does). Especially considering they're not nice at all with users who withdraw on L1, the contrast is too strange
- the fact that Muun is "too nice" with users like me who literally make them lose money
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Thank you for all the information Sr. I'm not going to use Muun that way but it's always constructive to know what's possible :)
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My pleasure friend! 🤝
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