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.

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Bifrost

# Bifrost Earnings Methodology

## 1. Overview

Bifrost Earnings is calculated as the net value retained by the Bifrost ecosystem after subtracting all expenses from revenue. Daily financial performance is captured across Bifrost Liquid Staking, Bifrost Stable Swaps, and Bifrost Substrate infrastructure operations. The calculation is performed on a daily basis where expenses are subtracted from revenue, with all values converted to USD. Values are generated for historical dates up to September 24, 2026.

## 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, `Redeemed` and `Minted` events from `vtokenMinting` contracts, and `Rewarded` events from `parachainStaking` contracts on Bifrost Substrate
- **External data**: End-of-day price feeds and asset metadata

## 3. Step-by-step calculation

### Component A: Bifrost Substrate, Bifrost Liquid Staking, and Bifrost Stable Swaps revenue calculation

- **Purpose**: Aggregate all fee-generating activities across the Bifrost ecosystem
- **Logic**: Revenue is aggregated from two primary sources. First, blockchain infrastructure fees are extracted from `TransactionFeePaid` events from `transactionPayment` contracts, where base transaction fees and tips paid by users are combined. These native asset fees are normalized by decimal precision. Second, application-level fees are collected across Bifrost Liquid Staking and Bifrost Stable Swaps, including liquid staking commission fees, channel commission updates, system staking payouts, stable swap fee collections, and redemption fees. For voucher asset commission fees, a ten-fold multiplier is applied to represent the full protocol fee structure. All voucher asset denominated fees are converted to underlying asset equivalents using price ratios calculated from minting events.
- **Key fields**: `transaction_fee`, `transaction_tip`, `fees`, `revenue`, `product_id`

### Component B: Voucher asset exchange ratio calculation

- **Purpose**: Calculate exchange ratios to convert voucher assets to their underlying asset equivalents
- **Logic**: Exchange ratios between underlying assets and their voucher equivalents are determined from `Minted` events from `vtokenMinting` contracts. Daily average ratios are calculated by dividing the underlying asset amount by the voucher asset amount. These ratios are forward-filled to handle days without minting activity, whereby consistent conversion rates are maintained for fee calculations.
- **Key fields**: `vtoken_price_ratio`, `currency_key`, `currency_index`

### Component C: Bifrost Substrate expense calculation

- **Purpose**: Calculate protocol operational costs in the form of incentives
- **Logic**: Expenses are defined as block rewards distributed to validators and stakers. These rewards are extracted from `Rewarded` events from `parachainStaking` contracts, representing native asset distributions for network security. The reward amounts are normalized by decimal precision to represent standard asset units before USD conversion.
- **Key fields**: `amount`, `token_incentives`

### Component D: USD conversion

- **Purpose**: Standardize all revenue and expense components in USD for consistent reporting
- **Logic**: Both revenue and expense components are converted to USD using end-of-day price feeds. Each fee or reward amount is matched with the appropriate asset price based on the price feed identifier, which is mapped to specific asset identifiers like 'bifrost-native-coin', 'polkadot', 'moonbeam', and other supported assets. Daily closing prices are applied during conversion to maintain consistent valuation timing.
- **Key fields**: Price conversion using end-of-day price feeds matched by asset identifier and date

### Component E: Earnings calculation

- **Purpose**: Combine all revenue and expense components to calculate daily net earnings
- **Logic**: Revenue streams from transaction fees and application fees are summed together by day, while expenses (block rewards) are separately aggregated by day. The voucher asset price ratios are applied during the individual fee calculations before aggregation. All asset amounts are first normalized by their respective decimal precision, then converted to USD using the appropriate end-of-day price feeds for the calculation date. Data is aggregated to daily boundaries using timestamp truncation to the day level, and missing days are handled with a zero-fill strategy to maintain continuous time series coverage. Daily earnings are computed by subtracting total daily expenses from total daily revenue, both in USD terms. Net profit generated by the Bifrost ecosystem is represented by the final calculated values, which are generated for historical dates up to September 24, 2026.
- **Key fields**: `revenue`, `expenses`, `earnings`

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

Net profit (also profits, net income, profitability) — revenue remaining after subtracting expenses.

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