Validators process transactions and receive fees from users (supply-side fees).

Algorand is a smart contract platform for decentralized applications (a blockchain). Algorand was founded by Silvio Micali and launched in 2018.

ALGO holders own and govern the protocol. They currently take a cut of the transaction fees paid by users (revenue). Algorand's investors include Union Square Ventures, Multicoin Capital, Pillar, etc.

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Algorand

# Algorand Fees Methodology

## 1. Overview

Fees are measured as the total value paid by users to perform transactions and interact with applications on the Algorand network. This includes costs associated with asset transfers, smart contract calls, and other on-chain operations. These payments represent the total economic value generated by the network and are used to compensate for the security and maintenance of the blockchain infrastructure. All fee data is denominated in the native asset (ALGO) and converted to USD for standardized reporting.

## 2. Data sources

- **Blockchain events**: Transaction data including the `fee` field from the Algorand blockchain, covering Algorand
- **External data**: End-of-day price feeds for the native asset (ALGO)

## 3. Step-by-step calculation

### Component A: Transaction fee extraction

- **Purpose**: Capture the raw cost of every transaction executed on the network
- **Logic**: The `fee` field is extracted from all transaction records where a fee value is present. This captures the cost paid in microAlgos by the transaction sender for every operation processed on the ledger.
- **Key fields**: `fee` (transaction cost)

### Component B: Unit normalization and daily aggregation

- **Purpose**: Convert fees from atomic units to the native asset and aggregate by day
- **Logic**: Raw transaction fees are summed at a daily granularity. These total amounts are normalized by decimal precision to convert values from microAlgos to the native asset (ALGO).
- **Key fields**: `block_timestamp` (timing), `fee` (quantities)

### Component C: USD conversion and final aggregation

- **Purpose**: Normalize fee values to USD for cross-asset comparison
- **Logic**: The daily native fee totals are multiplied by the end-of-day price feeds for the ALGO asset. Data is aggregated to a daily granularity with UTC day boundaries.
- **Key fields**: `timestamp`, `fees_native` (normalized quantities), `price_usd` (asset price)

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

Total value users pay to use a protocol (gross fees, user-paid fees).

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Fees

Fees

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