I think Pickle is making a bad shortsighted decision by keeping withdrawal fees. The logic behind their keeping withdrawal feels is “we want to go slow” but thats not true. The reality as I see it is that the Pickle team is scared as soon as they remove the withdrawal fee there will be a mass exodus of TVL.
What they are not realizing is that a 0.5% withdrawal fee means that you need three weeks of farming before you breakeven. Three weeks in DeFi might as well be a lifetime, a lot can change. As Andre Cronje says “Liquidity has no loyalty.” Pickle’s intention in keeping withdrawal fees is to be able to tax users of the UNI pools on the way OUT once UNI farming ends.
By them removing withdrawal fees now they will actually have NEW TVL come in and make even more money than the fearful approach of wanting to tax users on exit and being scared money will leave. I believe more money will be made by removing the withdrawal fee NOW rather than later.
Later on the APYs (pickle rewards) will ALSO be lower, thus yet again disincentivizing new money from coming in. So if they remove the withdrawal fees in lets say a month, when we’ve had 4 additional block reward reductions, it looks MUCH less appealing to new money. By removing it now new money will come in hoping to capture that high APY before its reduced knowing they are free to leave at any time.
This even has the positive consequence of good marketing and good will with the community.
Every day that goes by without change not only will block rewards go down, TVL will leave, AND pickle price will bleed. When these three things converge it’s called REKT CITY.
TLDR: Pickle team does not want to remove withdrawal fees. I believe its a critical error. They should remove withdrawal fees for the reasons listed above.