# Arbitrum One Average transaction fee Methodology

## 1. Overview

Average transaction fee is measured as the average fee paid by users per transaction on Arbitrum One. It reflects the typical cost of interacting with the network, including executing smart contracts and transferring assets. This metric is utilized to assess the economic usability and cost-efficiency of the network over time. The average is calculated by dividing the total fees collected by the total number of transactions executed on a daily basis.

## 2. Data sources

- **Blockchain events**: Transaction execution data and `AuctionResolved` events from `ExpressLaneAuction` contracts, covering Arbitrum One and Robinhood Chain
- **External data**: End-of-day price feeds for native gas assets

## 3. Step-by-step calculation

### Component A: Transaction count tracking

- **Purpose**: Calculation of the total number of transactions executed on Arbitrum One
- **Logic**: Transactions are aggregated daily from the transaction ledger. The total count of unique transaction hashes is calculated for each day
- **Key fields**: `transaction_hash`, `block_timestamp`

### Component B: Fee collection tracking

- **Purpose**: Calculation of the total fees generated by the network
- **Logic**: Fees are aggregated from three distinct sources: L2 gas fees, Timeboost auction fees, and Arbitrum Expansion Program license fees. L2 gas fees are calculated by multiplying the gas used by the effective gas price for each transaction. Timeboost fees are extracted from `AuctionResolved` events emitted by `ExpressLaneAuction` contracts. Arbitrum Expansion Program license fees are calculated as a licensed share of net fee-account inflows on participating chains (such as Robinhood Chain). All fee amounts are normalized by decimal precision
- **Key fields**: `gas_used_amount`, `gas_price`, `timeboost_fee`, `fee_inflow`

### Component C: USD conversion

- **Purpose**: Conversion of fee amounts to USD
- **Logic**: Normalized fee amounts in native assets are multiplied by the corresponding end-of-day asset prices
- **Key fields**: `price_usd`, `timestamp`

### Component D: Average transaction fee calculation

- **Purpose**: Determination of the daily average transaction fee in USD
- **Logic**: The total daily fee revenue in USD is divided by the daily transaction count. If the transaction count is zero, the average fee is set to zero to prevent division-by-zero errors
- **Key fields**: `fees`, `transaction_count`

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

Average transaction fee

Arbitrum One

Arbitrum One batches users' transactions and submits them to Ethereum, paying a share of the transaction fees to Ethereum validators (expense).

Arbitrum One is an L2 smart contract platform for decentralized applications on Ethereum. Arbitrum was founded by Offchain Labs and launched in 2021.

ARB tokenholders own and govern the protocol. They currently run the only sequencer and take a cut of the total transaction fees paid by users (revenue). Arbitrum’s investors include Polychain, Alameda Research, Coinbase Ventures, etc.

Arbitrum OneARB

Average transaction fee

Average transaction fee

Competitive landscape

Chain breakdown