How can Flare balance increasing the number of supported assets for its State Connector protocol against maintaining low transaction fees?

Introduction

Balancing the expansion of supported assets for Flare's State Connector protocol against maintaining low transaction fees presents a critical trade-off. This scenario involves weighing the benefits of increased functionality and potential user base growth against the risk of higher operational costs and reduced accessibility. I'll analyze this trade-off by examining the product ecosystem, potential impacts, key metrics, and experimental approaches to inform a strategic recommendation.

Step 1

Clarifying Questions (3 minutes)

• Based on the current market dynamics, I'm thinking asset diversity might be a key differentiator. Could you provide more context on our competitors' asset support and how it's impacting our market share?

Why it matters: Helps assess the urgency and potential impact of expanding asset support. Expected answer: We're lagging behind in certain asset classes, affecting user acquisition. Impact on approach: Would prioritize strategic asset additions over blanket expansion.

• Considering our revenue model, I assume transaction fees play a significant role. Can you clarify how our fee structure compares to industry standards and its contribution to our overall revenue?

Why it matters: Determines the flexibility we have in adjusting fees without compromising financial stability. Expected answer: Fees are competitive but a major revenue source. Impact on approach: Would explore tiered fee structures or alternative revenue streams.

• Looking at user behavior, I'm curious about the demand for additional assets. Do we have data on user requests or transaction volumes for currently unsupported assets?

Why it matters: Helps prioritize which assets to add based on user demand. Expected answer: There's significant demand for certain asset classes. Impact on approach: Would focus on high-demand assets first to maximize impact.

• From a technical perspective, I'm wondering about the scalability of our current infrastructure. How much additional load can our system handle before requiring significant upgrades?

Why it matters: Determines the feasibility of asset expansion without compromising performance. Expected answer: Current system can handle 30% more load before upgrades are needed. Impact on approach: Would phase asset additions to align with infrastructure capacity.

• Regarding our development resources, I'm thinking this might require significant effort. Can you share insights on our current team capacity and any competing priorities?

Why it matters: Helps assess the realistic timeline and resource allocation for implementation. Expected answer: Team is at 80% capacity with ongoing projects. Impact on approach: Would consider outsourcing or reprioritizing current projects.