High Gas Fees on Robinhood Chain: Is LP Farming a Better Strategy?

Original author: 0xLonglife

Robinhood Chain continues to gain momentum. Data shows that in its first two months since launch, Robinhood Chain has processed 463 million total transactions, with 12.08 million active wallets, $52 billion in cumulative DEX trading volume, and nearly 594,000 on-chain meme coin trading pairs.

Fees are the most honest indicator of a chain’s sentiment: The cumulative gas fees on Robinhood Chain have reached 4,274 ETH. According to DefiLlama data, Robinhood Chain’s daily gas fees rose from approximately $56,000 on August 23 to around $3.75 million on September 1. This surge in revenue is driven not only by increased trading volume but also by the chain’s high costs—community members are beginning to complain that “transaction fees are getting too expensive,” with some even noting that fees now exceed those on Ethereum’s mainnet.

High trading fees are certainly unfavorable for traders, but from another perspective, was the LP that farmers were most familiar with during DeFi Summer six years ago really a good thing?

So we want to evaluate whether, under these fee conditions, it’s more cost-effective to keep farming PvP or to select high-quality pools for LP.

Robinhood Chain is an Arbitrum-based L2, with fees consisting of two parts:

L2 execution fee: On-chain execution fee;

L1 data fee: The cost of posting transaction data to Ethereum's data availability layer.

The official documentation states that L1 data fees vary with Ethereum congestion and calldata size. Therefore, regular transfers and complex swap/launchpad transactions are not on the same cost level. Transactions on platforms like Pons and long.xyz generate additional calldata and contract calls, making gas only the first layer of cost. In essence, token launch platforms act as amplifiers of user fee expenditures.

Taking Pons as an example: Pons charges 0.0005 ETH for token issuance and 1% for V1 swaps; the default Curve fee for V2 is 1%, with a creator tax of up to 10%, and even after the token graduates, the Uniswap v4 hook can still collect 1%. Fees are distributed to the protocol, creators, PONS buyback and burn, meme token buyback and burn, Uniswap/LP, and more. Even Pons’ own official account acknowledged yesterday that, over the past 24 hours, Pons was the platform with the highest user fees among on-chain launchpads.

Therefore, the high cost of Robinhood Chain stems from three layers: on-chain gas fees, token transaction taxes, miscellaneous fees, and the recurring cost of failures in high-frequency PvP interactions.

Taking microduck as an example, assume a user purchases the token with $1,000 worth of ETH. The aggregator’s trade path should be: WETH → USDG → NVDA → microduck. Under this path, each step uses the most liquid pool, resulting in transaction costs exceeding 20 USDT for the user during the purchase, primarily due to Pons V2 hook fees and creator fees (each at 1%).

Similarly, if you sell after a 50% increase in microduck, the transaction costs exceed $30. As a result, a trade with a paper profit of 50%, theoretically yielding $500, actually nets $437.30, with transaction costs totaling approximately $62.70.

And just like that, investors who finally managed to catch a golden dog coin had 12.54% of their profits taken by the trading intermediary.

Many people think trenching is a game of information asymmetry. But after fees increased, it has become more of a cost-control game.

Dune data shows: Among traders who sold memecoins on Robinhood Chain over the past 30 days:

Profitable addresses: 479,514;

Loss addresses: 716,383;

Loss percentage: approximately 59.9%;

To be honest, the above profit-loss ratio is already impressive given that the crypto market has not fully turned bullish. However, the current data includes profits and losses from the first 50 days of Robinhood’s on-chain simple mode. At present, funds are flooding into the rh chain, and community feedback indicates that the difficulty level has entered “hell mode.” Foreigners are reporting daily hacks on their Twitter accounts, and the profit-loss address ratio is likely to worsen further.

Additionally, due to persistently high on-chain fees, a PvP paradox is exacerbated: the higher the fees, the higher the win rate threshold for small accounts; the greater the tax, the larger the price movement required for short-term trading to be profitable. In the end, the trench isn’t without opportunity—it simply demands that you act earlier, faster, and more accurately than most, while also paying increasingly higher friction costs. Over time, the more expensive the fees become, the harder it is for low-win-rate speculative strategies to outperform over the long term.

Thus, the value of seeking high-quality LP pools through unconventional approaches is increasingly evident, because PvP profits come from counterparties, while LP profits come from the trading ecosystem itself.

Combining the current RH chain炒作 theme with meme coins, and referencing data from the Robinhood Chain pools, the editor has selected several pools worth monitoring:

Here’s an explanation of the data’s origin: Tokens issued by platforms like Pons are mostly equity tokens, and most users do not hold large quantities of these tokens. As a result, the routing process involves an additional step, and this extra step generates our excess revenue.

It should be noted that, as an on-chain native ve(3,3) protocol on the rh chain, the APRs for AAPL/USDG and WETH/USDG on UP appear high, but the TVL is relatively low, and the sustainability of these yields requires further observation.

Another approach is to identify and hold long-term promising RH chain infrastructure projects by forming liquidity pools. Investors are advised to focus on RH chain-native protocols that have already delivered products—such as Up, the ve(3,3) protocol mentioned earlier. Benefiting from a recent rapid increase in token valuation, Up’s token is currently paired with WETH on this platform, offering an APR as high as 21,950%.

Additionally, projects such as NET (an OHM-like OlympusDAO protocol), Index (an officially recognized stock dividend protocol), and Mancer (a native order-book DEX on the rh chain) are expected to perform well over the long term, barring any unforeseen issues. Their current largest mainstream pool APRs are 2341%, 1261%, and 1059%, respectively.

Finally, savvy on-chain degens have taken a "dark path," leveraging the high volatility and scarce liquidity of popular meme coins by creating custom high-fee liquidity pools on Uniswap V4, riding the wave of on-chain FOMO to generate solid returns. For example, yesterday’s brief surge in the Rabbit token saw someone create a USDG pool with an 8% fee rate; the pool achieved a TVL of $328,000, generated $239,000 in trading volume within 24 hours, and netted $19,000 in fees—yielding an APR of 2,124%. However, this is essentially another form of meme coin speculation, betting that the token won’t collapse immediately.

In summary, the operational strategy for Robinhood Chain under the new circumstances appears to require rethinking. In a low-fee era, trenches could tolerate high-frequency experimentation; in a high-fee era, every click becomes a chip. For average users, the win rate in PvP is only about 40%, further eroded by gas fees, platform fees, slippage, and failed transactions. In contrast, selecting high-quality stock tokens or index token pools for LP effectively places you on the fee-collecting side of trading traffic.

The editor believes that, in the current environment where Robinhood Chain fees are rapidly rising, a more cost-effective strategy is not to blindly enter the fray, but rather to use small positions to participate in high-conviction narratives, while reserving the main position for LPs with high trading volume, more stable prices, and non-fragile TVL.

Traders profit from making directional calls amid chaos. LPs profit from the chaos itself.