Fees are initially set when registering an operator but can be changed at any point in time.
Fee changes are generally initiated to stay competitive with other operators or to align with SSV market price fluctuations.
To ensure fee updates are transparent and stakers have enough time to adjust accordingly (by depositing more balance or replacing that operator) the network utilizes an operator fee change cycle, that happens in 2 steps:
Operator fee update cycle
Declaring a new fee - a broadcast to the network that the operator is changing their fee.
Executing the declared fee - finalizing the fee update process (only after this does the fee change take effect).
Between each of these 2 steps is a waiting period - declaration period - a period (days) determined by the DAO, for which the operator must wait before executing the newly declared fee.
The fee execution is also followed by an execution period - if an operator fails to execute their declared fee in this period, it will expire and they must restart the process.
For example, if an operator declares a new fee, they have to wait X days (declaration period) before being able to execute it. Once the period has passed, they have Y days to execute it (execution period) before it expires.
Operators can always cancel their declared fee (during the declaration period or execution period) and stay with the existing fee.
Fee Increase Limitations
A restriction has been set in place by the network which limits the percentage of change that operators can update their fee in each cycle (i.e. <10%). This limitation is decided by the DAO and is implemented to protect stakers against sudden liquidations due to fee updates and malicious behaviors.