MetaMask Fees – Fee Collection When Transaction Cost Exceeds Fee

erc-20gasmetamask

Especially on Ethereum network, the transaction fee (when exchanging a token with another) might be more than $10 in many cases. I am interested, how MetaMask charges its small fee (i.e. 0.87% or whatever), while let's say for example, if sum of fee is up to $10, but transaction cost is more than that, then how does MetaMask obtains those fees from us? What method it uses to cut that fee and send to themselves?

Best Answer

Don't confuse the gas fee with the Metamask fee. The metamask fee only applies to swaps, not on direct wallet to wallet transfer. You will always have to pay the gas fee anyway, but it's not part of your metamask swap order.

In the case of a swap, as they explain here :

A service fee of 0.875% is automatically factored into each quote

A currency / coin pair is alway in the format BASE/QUOTE.

In ETH/USDT, ETH is the Base and USDT the Quote.

Meaning that if the actual change rate of coin A to coin B is 1, you will pay for a change rate of 1.00875.

So to buy 100 ETH you will pay 100.875 BUSD. ( 100 for the change rate, and 0.875 for the fee )

When swapping using metamask you will interact with their smart contract swap router first.

The swap router will internally forward your order to another contract that currently seems to live at 0x74de5d4FCbf63E00296fd95d33236B9794016631.

If you check the internal transactions made by that contract you will see that for each call received from the Metamask Swap Router, one transaction goes to an Exchange, and another one goes to the Metamask: Fees contract, this is the 0.875.

So when you send quote + fee Metamask forwards the quote to the exchange to fulfill your order, and forwards your fee to their own contract.

Related Solutions

Solidity – Why uint8 Costs More Gas than uint256

The EVM works with 256bit/32byte words (debatable design decision). Every operation is based on these base units. If your data is smaller, further operations are needed to downscale from 256 bits to 8 bits, hence why you see increased costs.

Btw, if you toggle the "Details" on the online solidity compiler, it will give you the exact assembly dump where the extra opcodes are from. I didn't have time now to interpret them, but if you do and find there's something extra, I'm sure the Solidity team would be happy to add optimizations to work around them.

[Ethereum] Including transactions fees when sending out ETH from a smart contract

According to the solidity docs, I don't think your first request is possible. In fact, the docs recommend switching to a withdraw scheme:

Warning: There are some dangers in using send: The transfer fails if the call stack depth is at 1024 (this can
always be forced by the caller) and it also fails if the recipient runs out of gas. So in order to make safe Ether
transfers, always check the return value of send or even better: Use a pattern where the recipient withdraws the
money.

After switching to a withdrawal pattern, you can simply use web3.eth.estimateGas().

Best Answer

Related Solutions

Solidity – Why uint8 Costs More Gas than uint256

[Ethereum] Including transactions fees when sending out ETH from a smart contract

Related Topic