Liquidity providers deposit funds into Buffer Finance and receive trading fees from binary options traders (supply-side fees).

Buffer Finance is a non-custodial binary options exchange built on Arbitrum and Polygon. Buffer Finance was founded by an anonymous team and launched in 2021.

BFR token holders own and govern the protocol. They currently take a cut of the total trading fees paid by binary options traders (revenue).

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Buffer Finance

# Buffer Finance Expenses Methodology

## 1. Overview

Buffer Finance expenses represent the daily USD value of esBFR (escrowed Buffer) tokens paid as incentives to users for trading and staking activities. This metric captures the protocol's operating costs associated with rewarding user participation, treating token incentives as direct expenses. The calculation aggregates all esBFR token claims from Buffer Finance's staking contracts on Arbitrum and converts them to USD values.

## 2. Data sources

- **Blockchain events**: Parsed `Claim` events from Buffer Finance's `StakedBfrTracker` and `StakedBlpTracker` contracts on Arbitrum blockchain
- **External data**: End-of-day price feeds for esBFR token USD conversion and token metadata for decimal precision handling
- **Contract addresses**: Specific Buffer Finance staking contract addresses that emit reward claim events

## 3. Step-by-step calculation

### Component A: Raw token incentive extraction
- **Purpose**: Captures all esBFR token claims from Buffer Finance staking contracts
- **Logic**: Extracts `Claim` events from two specific Buffer Finance contracts on Arbitrum - the `StakedBfrTracker` and `StakedBlpTracker` contracts. Each claim event represents a user claiming esBFR token rewards for either trading activities or staking participation. The extraction captures the claiming user's `address`, the raw `amount` claimed, transaction metadata including `block_timestamp`, `transaction_hash`, and `log_index`, and classifies each claim with business metadata including options trading as the business line, derivatives as the market sector, and option as the business segment.
- **Key fields**: User `account_address`, raw token `amount` claimed, `block_timestamp` for timing, `token_address` pointing to the esBFR token contract, and business classification fields

### Component B: Daily aggregation and USD conversion  
- **Purpose**: Converts raw token claims to daily USD values with proper decimal handling
- **Logic**: Groups all claim events by day using timestamp truncation to daily boundaries, maintaining chain and business metadata groupings. Applies decimal correction to convert raw blockchain token amounts from their native 18-decimal representation to standard numeric values. Converts corrected token amounts to USD using end-of-day price feeds for the esBFR token, ensuring consistent daily valuation timing. Sums all converted amounts within each day to get total daily token incentive expenses.
- **Key fields**: Daily `timestamp`, `chain_id` as arbitrum, aggregated `token_incentives` in USD, and preserved business classification metadata

### Final aggregation
- **Combining components**: The daily aggregated token incentives flow directly into the expenses metric, with `token_incentives` field renamed to `expenses` to reflect the accounting treatment
- **Currency conversion**: USD conversion uses end-of-day price feeds applied after decimal correction, ensuring consistent daily pricing methodology
- **Time aggregation**: All calculations use daily boundaries with timestamp truncation to day level, ensuring clean daily expense reporting
- **Final calculation**: The final expenses value equals the daily sum of all esBFR token claims converted to USD, representing the protocol's daily operating costs for user incentives. The metric applies standardized schema validation, fills missing dates with zero values, and applies chain availability filtering to ensure data consistency across the reporting period.

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

Total project operating and incentive expenses.

Buffer FinanceBFR

Expenses

Expenses

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Chain breakdown