The 1inch Aggregation Protocol routes users' trades through the most efficient path for a token swap and aggregates multiple non-custodial exchanges.

The 1inch Network unites multiple decentralized protocols built on Ethereum and other blockchains. This dashboard tracks the 1inch Aggregation Protocol, which is a non-custodial DEX aggregator. 1inch was founded by Sergej Kunz & Anton Bukov and launched in 2019.

The 1inch Network is governed by 1inch DAO – a decentralized autonomous organization. Voting on the DAO is performed through the 1INCH token, a governance token, that was initially distributed to the community of 1inch Network users in late 2020. They currently do not take a cut of the total trading fees paid by traders (revenue). 1inch's investors include ParaFi Capital, FTX Exchange, Pantera Capital, etc.

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# 1inch Supply-side fees Methodology

## 1. Overview

Supply side fees represent the portion of total fees that are distributed to liquidity providers or other supply-side participants in a protocol. For 1inch, this metric is consistently set to zero because 1inch operates as a DEX aggregator that retains all collected fees rather than sharing them with liquidity providers. The calculation tracks total fee collections to 1inch treasury addresses and then sets the supply side allocation to zero.

## 2. Data sources

The calculation relies on several key data sources:

- **Ethereum token transfer events**: Parsed `Transfer` events capturing ERC20 token movements to 1inch treasury addresses
- **Ethereum transaction traces**: ETH transfer traces showing native ETH payments to treasury addresses  
- **End-of-day token price feeds**: Price data for converting collected fees to USD values
- **Token metadata**: Decimal precision information for proper token amount calculations

## 3. Step-by-step calculation

### Component A: Fee collection tracking
- **Purpose**: Identify all fee payments flowing into 1inch treasury addresses
- **Logic**: Monitor inflows to two specific treasury addresses: `0xdd9f24efc84d93deef3c8745c837ab63e80abd27` (treasury 1, active from March 2021 to November 2021) and `0x7951c7ef839e26f63da87a42c9a87986507f1c07` (treasury 2, active from October 2021 onwards). For treasury 1, collect all token transfers and ETH traces within the active date range, excluding transfers from Binance address `0x28c6c06298d514db089934071355e5743bf21d60` and denylisted tokens. For treasury 2, apply more restrictive filtering using an allowlist of major tokens including USDC, USDT, 1INCH, WETH, DAI, and WBTC, while excluding specific denylisted transactions.
- **Key fields**: Extract `block_timestamp` for daily aggregation, `token_address` for price lookup, `amount` for fee quantities, and `from_address` for filtering

### Component B: Fee standardization and conversion  
- **Purpose**: Convert collected fees to standardized daily USD amounts
- **Logic**: Group fee collections by day using timestamp truncation, correct token decimal places based on token metadata, convert amounts to USD using end-of-day price feeds, and sum all fees by timestamp and chain. Apply business line classification as "DEX Aggregator" and market sector as "exchanges".
- **Key fields**: Aggregate `fees` amounts, apply `timestamp` daily grouping, use `chain_id` for chain identification, and generate USD-denominated `fees` values

### Component C: Supply side allocation
- **Purpose**: Determine what portion of fees goes to supply side participants  
- **Logic**: Set `fees_supply_side` to zero for all records since 1inch retains all collected fees rather than distributing them to liquidity providers or other supply-side participants. This reflects 1inch's business model as a DEX aggregator that earns revenue by charging fees on trades while routing through other protocols' liquidity.
- **Key fields**: Generate `fees_supply_side` field with constant zero values

### Final aggregation
- **Combining components**: Join fee collection data with the zero supply side allocation, maintaining daily timestamp grain and chain identifiers
- **Currency conversion**: All fees converted to USD using end-of-day token prices with proper decimal correction
- **Time aggregation**: Daily boundaries set by truncating timestamps to day precision  
- **Final calculation**: Supply side fees equal zero for all periods, representing 1inch's fee retention model where the protocol keeps 100% of collected fees rather than sharing with supply side participants

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

Portion of fees distributed to service providers or supply-side participants.

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