# Bifrost Substrate Fees Methodology

## 1. Overview

Fees measures the total value paid by users to interact with the Bifrost Substrate blockchain and its integrated decentralized applications. This metric includes network-level transaction fees (gas and tips) required for block inclusion, as well as application-specific fees generated by Bifrost Liquid Staking and Bifrost Stable Swaps. These fees represent the total economic value generated by the protocol's liquid staking derivatives (vTokens) and liquidity pools, which are used to compensate validators and the protocol treasury.

## 2. Data sources

- **Blockchain events**: `TransactionFeePaid` events from `transactionPayment` contracts, `HostingFeeCharged` events from `slp` contracts, `ChannelClaimableCommissionUpdated` events from `channelCommission` contracts, `Payout` events from `systemStaking` contracts, `FeeCollected` events from `stableAsset` contracts, and `Redeemed` and `Minted` events from `vtokenMinting` contracts on Bifrost Substrate
- **External data**: End-of-day price feeds for native assets and liquid staking derivatives

## 3. Step-by-step calculation

### Component A: Network-level transaction fees

- **Purpose**: Capture the base cost of executing transactions on the Bifrost Substrate blockchain.
- **Logic**: Transaction fees and optional tips are extracted from `TransactionFeePaid` events within the `transactionPayment` module. The total fee per transaction is calculated as the sum of the transaction fee and the tip. These values are normalized by a decimal precision of 12, reflecting the native BNC asset.
- **Key fields**: `transaction_fee`, `transaction_tip`

### Component B: Liquid Staking hosting and commission fees

- **Purpose**: Capture fees associated with the management and distribution of liquid staking assets.
- **Logic**: Hosting fees are parsed from `HostingFeeCharged` events in `slp` contracts and scaled by a factor of 10 to reflect the total protocol take. Channel-related commissions are extracted from `ChannelClaimableCommissionUpdated` events in `channelCommission` contracts. These fees are associated with the Bifrost Liquid Staking product.
- **Key fields**: `fees`, `currency_key`, `currency_index`

### Component C: System staking and redemption fees

- **Purpose**: Capture revenue from protocol-level staking payouts and asset redemptions.
- **Logic**: Payout events are parsed from `systemStaking` contracts to identify fees generated from staking activities. Additionally, withdrawal or redemption fees are captured from `Redeemed` events within `vtokenMinting` contracts. Both components are aggregated under the Bifrost Liquid Staking product.
- **Key fields**: `fees`, `currency_key`, `currency_index`

### Component D: Stable swap fee extraction

- **Purpose**: Capture trading fees generated by the protocol's internal liquidity pools.
- **Logic**: Swap-related fees are identified by parsing `FeeCollected` events from `stableAsset` contracts. These fees are categorized under the Bifrost Stable Swaps product.
- **Key fields**: `fees`, `currency_key`, `currency_index`

### Component E: Asset valuation and USD conversion

- **Purpose**: Normalize all collected fees into a common currency (USD).
- **Logic**: Asset identifiers (keys and indices) are mapped to specific metadata for decimal normalization. Because liquid staking assets (vTokens) may deviate from the price of their underlying assets, a price ratio is derived by comparing `token_amount` and `v_token_amount` from `Minted` events in `vtokenMinting` contracts. This ratio is applied to ensure accurate valuation. Final amounts are multiplied by end-of-day price feeds to calculate the USD value.
- **Key fields**: `vtoken_price_ratio`, `decimals`, `coingecko_id`

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

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

Fees

Blockchains (L2)

Collators aggregate parachain transactions block candidates and producing state transition proofs for validators based on those blocks.

Bifrost is the Staking Yield Layer app-chain for stablecoins, RWAs, and DeFi, powered by the Polkadot Relay chain.

BNC holders own and govern the protocol. Bifrost’s investors include OKX Ventures, Long Hash Ventures, etc.

Bifrost Substrate

Archived

Fees

Fees

Chain breakdown