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

BMX is a non-custodial exchange for spot and perpetual contracts built on Base. BMX has three product lines: Classic, Freestyle, and Based MediaX

BMX tokenholders own and govern the protocol. They currently take a cut of the total trading fees paid by traders (revenue).

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# BMX Earnings Methodology

## 1. Overview

Earnings measures the net value retained by BMX after all expenses are subtracted from total revenue. This metric reflects the on-chain profitability of the protocol across its primary products, including BMX Classic, BMX Freestyle, Based MediaX, and Deliswap. Revenue is generated through trading fees, mint/burn fees, and recouped emissions, while expenses include operating costs such as Aerodrome bribes, volume incentives, and token-based rewards distributed to users and liquidity providers.

## 2. Data sources

- **Blockchain events**: `FeeTransferred` events from `SudoVRFRouter` contracts; `CollectMarginFees`, `CollectSwapFees`, `SellUSDG`, `BuyUSDG`, and `Swap` events from `Vault` contracts; `SendQuote` and `RequestToClosePosition` events from `SymmioDiamond` contracts; `Call` events from `MultiAccount` contracts; `FeeCollected` events from `FeeProcessor` contracts; `Initialize` events from `PoolManager` contracts; `NotifyReward` events from `BribeVotingReward` contracts; `ClaimRewards` events from `Gauge` contracts; `Distribute` events from `RewardDistributor` contracts; `DistributeVolumeRewards` events from `VolumeRewardDistributor` contracts; `Reward` events from `DibsRewarder` contracts; and `Claimed` events from `IncentiveGauge` contracts, covering Base
- **External data**: End-of-day price feeds for assets and metadata

## 3. Step-by-step calculation

### Component A: Based MediaX revenue

- **Purpose**: Capture protocol fees generated by the Based MediaX product
- **Logic**: `FeeTransferred` events are parsed from `SudoVRFRouter` contracts. These events are joined with pair metadata from `SudoFactoryWrapper` to identify the associated assets. Amounts are normalized by decimal precision and converted to USD using end-of-day price feeds.

### Component B: BMX Classic revenue

- **Purpose**: Aggregate fees from perpetual trading, spot trading, and liquidity management on BMX Classic
- **Logic**: Perpetual trading fees are extracted from `CollectMarginFees` events, and spot trading fees are captured from `CollectSwapFees` events from `Vault` contracts. Fees associated with minting and burning the liquidity asset (BLT) are calculated from `BuyUSDG` and `SellUSDG` events. Additionally, spot trading fees are derived from `Swap` events by applying the fee basis points to the lower USD value of the input or output asset to mitigate the impact of price manipulation.

### Component C: BMX Freestyle revenue

- **Purpose**: Calculate the protocol's share of fees from the BMX Freestyle product
- **Logic**: Trading activity is identified via `SendQuote` and `RequestToClosePosition` events from `SymmioDiamond` contracts, which are validated against successful `Call` events from `MultiAccount` contracts. A 60% revenue allocation is applied to the total fees generated, representing the protocol's retained portion after the infrastructure provider's share is deducted.

### Component D: Deliswap revenue

- **Purpose**: Determine net revenue from the Deliswap AMM
- **Logic**: Gross fees are extracted from `FeeCollected` events from `FeeProcessor` contracts, excluding internal buyback swaps. Net revenue is calculated by subtracting supply-side rewards, which are parsed from `RewardsAdded` events from `DailyEpochGauge` contracts.

### Component E: Treasury management revenue

- **Purpose**: Capture additional revenue from recouped Aerodrome emissions
- **Logic**: AERO emissions induced by protocol bribes are tracked by parsing `ClaimRewards` events from Aerodrome `Gauge` contracts. Only claims performed by specific protocol-funded addresses are included in this revenue component.

### Component F: Operating expenses

- **Purpose**: Aggregate on-chain costs associated with protocol growth and maintenance
- **Logic**: Expenses are summed from three primary sources: bribes paid to Aerodrome (captured from `NotifyReward` events from `BribeVotingReward` contracts), liquidity incentives for the BLT pool (extracted from `Distribute` events), and volume-based rewards for traders (parsed from `DistributeVolumeRewards` and `Reward` events).

### Component G: Token incentives

- **Purpose**: Track the USD value of protocol tokens distributed as incentives
- **Logic**: Token-based distributions are identified through `Distribute` events from `RewardDistributor` contracts (specifically for oBMX) and `Claimed` events from `IncentiveGauge` contracts on Deliswap. Amounts are normalized by decimal precision and multiplied by end-of-day asset prices.

### Component H: Final earnings aggregation

- **Purpose**: Combine all revenue and expense components to calculate net earnings
- **Logic**: Total revenue is calculated as the sum of components A, B, C, D, and E. Total expenses are calculated as the sum of components F and G. Earnings are determined by subtracting total expenses from total revenue. All calculations are performed at a daily granularity using UTC day boundaries.

*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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