Liquidity providers deposit funds into Bancor and receive trading fees from traders (supply-side fees).

Bancor is a non-custodial exchange protocol built on Ethereum. Bancor was founded by Galia Benartzi, Guy Benartzi, Eyal Hertzog, & Yudi Levi and launched in 2016.

BNT tokenholders own and govern the protocol. They currently take a cut of the total trading fees paid by traders (revenue). Bancor's investors include DeFiance Capital, ParaFi Capital, Mechanism Capital, etc.

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Bancor

# Bancor Token incentives Methodology

## 1. Overview

Token incentives represents the total value of BNT tokens distributed by Bancor to liquidity providers as rewards and compensation. This metric combines two components: direct liquidity provider rewards from staking programs and impermanent loss compensation paid during liquidity withdrawals. The calculation aggregates daily BNT token distributions across all Bancor versions and converts them to USD values.

## 2. Data sources

The calculation uses several types of raw blockchain data from Ethereum:

- **Reward events**: Parsed Ethereum events from Bancor staking contracts including `RewardsClaimed` and `RewardsStaked` events from StakingRewards, StakingRewardsClaim, and StandardRewards contracts
- **Token events**: Ethereum BNT token `Issuance` events, `Transfer` events, and vBNT token `Destruction` events  
- **Function calls**: Ethereum transaction traces for Bancor liquidity functions including `addLiquidity`, `removeLiquidity`, `deposit`, `depositFor`, and `withdraw` calls across LiquidityProtection, LiquidityProtectionV2, and BancorNetwork contracts
- **External data**: End-of-day token price feeds for USD conversion and token metadata for decimal corrections
- **Account mappings**: Hardcoded mappings of contract addresses to account types (Standard Rewards, Staking Rewards, Impermanent loss compensation)

## 3. Step-by-step calculation

### Component A: Liquidity provider rewards
- **Purpose**: Captures direct BNT token rewards paid to liquidity providers through staking programs
- **Logic**: Extracts reward events from multiple Bancor staking contracts, filtering for BNT token payments (address `0x1f573d6fb3f13d689ff844b4ce37794d79a7ff1c`). Processes `RewardsClaimed` and `RewardsStaked` events from StakingRewards and StakingRewardsClaim contracts, plus `RewardsClaimed` events from StandardRewards contracts where the pool matches the BNT address. Assigns version labels based on contract type (v1 for StandardRewards, otherwise the contract version)
- **Key fields**: `block_timestamp` for timing, `address` as the recipient account, `amount` as the BNT token quantity, and standardized metadata fields including business_line as 'Exchange AMM'

### Component B: Impermanent loss compensation  
- **Purpose**: Identifies BNT tokens minted as compensation for impermanent loss during liquidity withdrawals
- **Logic**: Matches liquidity withdrawal function calls with BNT token `Issuance` events occurring in the same transaction and block. For v2.1 (LiquidityProtection contracts), only includes withdrawals from accounts that previously deposited liquidity by checking against the depositor addresses dimension. For v3 (BancorNetwork), excludes cases where vBNT was burned in the same transaction and includes transfers to the vault address `0x649765821d9f64198c905ec0b2b037a4a52bc373`
- **Key fields**: `block_timestamp` from withdrawal functions, `to_address` as the recipient, `amount` from the matched BNT issuance event, with conditional logic setting amount to 0 for ineligible accounts

### Component C: Account metadata enrichment
- **Purpose**: Adds descriptive names to incentive-paying contract addresses  
- **Logic**: Joins the combined incentive data with a dimension table containing hardcoded mappings of contract addresses to account names such as 'Standard Rewards', 'Staking Rewards', and 'Impermanent loss compensation'
- **Key fields**: `account_address` for joining, `account_name` and `contract_name` from the dimension table

### Final aggregation
- **Combining components**: Uses UNION ALL to combine liquidity provider rewards and impermanent loss compensation into a single dataset, then joins with account dimension data
- **Currency conversion**: Applies the `convert_to_usd_and_correct_decimals` macro to convert BNT token amounts to USD using end-of-day price feeds and correct for token decimals  
- **Time aggregation**: Truncates timestamps to daily grain using `timestamp_trunc` function
- **Final calculation**: Uses the `finalize_metric_token_incentives` macro with a 'fill_zeros' strategy to standardize the schema, validate identifiers, and fill gaps in the daily time series with zero values. Applies chain availability filtering to ensure data completeness

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

Value of native tokens distributed as incentives.

BancorBNT

Token incentives

Token incentives

Competitive landscape

Chain breakdown