The original Smart Account Fee Engine proposal by Lukas outlines a mechanism for Agent-assisted Fee Settlement.

Agents settle the Fee Intents between Fee Taker (developer) and Fee Payer (user), issuing Fee Credits that serve as a guarantee that fees will eventually be settled.

Agents solve for latency in the fee settlement process fee settlement processes (non-atomic asset swaps, cross-chain asset bridging, or on-ramping), while reducing gas overhead associated with fee collection. In exchange, they receive access to order flow, the ability to charge a spread, and other economic motivations.

Staking plays a critical role in the mechanism, ensuring Fee Credits are collateralized and settle as expected:

To ensure Fee Credits have sufficient backing, Agents must provide a stake as collateral to the Fee Engine. The amount of Fee Credits an Agent can issue is proportional to the stake they allocate. The staking requirements means Agents cannot be undercollateralized, safeguarding against scenarios where fees may not be settled or take longer than expected. In case of fees not being settled as expected, the Agents’ staked collateral is used at redemption of the Fee Credits. As a result, Agents assume various counterparty risks as part of the fee settlement:

• Conversion risk: The potential loss due to fluctuating exchange rates.
• Liquidity risk: The potential for a lack of liquidity to negatively impact settlement paths.
• Smart contract risk: The potential for vulnerabilities in smart contracts such as bridges.

Agents may require a grace period between issuing Fee Credits and their redemption. This buffer ensures Agents have adequate time to settle fees, ensuring their staked amount remains unaffected.

The SAFE token could be used for the staking collateral described above. Agents would stake SAFE, allowing them to issue Fee Credits according to a DAO-governed collateralization ratio. Collateral could be slashed to cover any Fee Credit settlement shortfall.