Validators process transactions and receive fees from users (supply-side fees).

Cardano is a smart contract platform for decentralized applications (a blockchain). Cardano was founded by Charles Hoskinson & Jeremy Wood and launched in 2017.

ADA holders own and govern the protocol. They currently do not take a cut of the total transaction fees paid by users (revenue).

governance

github

twitter

website

Blockchains (L1)

Cardano

# Cardano Average revenue per user (ARPU) Methodology

## 1. Overview

Average revenue per user (ARPU) measures the daily revenue generated per active user on the Cardano network. It is calculated as the total daily protocol revenue divided by the number of unique active users (daily). Protocol revenue on Cardano is defined as the 20% portion of transaction fees that is directed to the network treasury, representing the value captured by the protocol from each participant's activity.

## 2. Data sources

- **Revenue**: Derived from the Revenue metric
- **Active users (daily)**: Derived from the Active users (daily) metric

## 3. Step-by-step calculation

### Component A: Protocol revenue calculation

- **Purpose**: To determine the portion of transaction fees captured by the network treasury.
- **Logic**: Transaction fees are extracted from the Cardano network and converted from lovelace to ADA, where 1,000,000 lovelace equals 1 ADA. These native fee amounts are multiplied by end-of-day price feeds to determine the USD value. Protocol revenue is then calculated by applying a 20% allocation to the total daily fees, representing the "tau" parameter that directs a fixed percentage of all transaction fees to the Cardano treasury.
- **Key fields**: `fees` (transaction costs in lovelace), `block_timestamp` (timing of collection).

### Component B: Active user identification

- **Purpose**: To identify unique daily participants on the network.
- **Logic**: Active users (daily) are identified by parsing the transaction inputs from the network's UTXO (Unspent Transaction Output) model. The `address` field is extracted from each input within a transaction to identify the sender. Distinct addresses are aggregated daily, and the total count of these unique addresses is used to determine the number of active users (daily) within a UTC 24-hour window.
- **Key fields**: `address` (unique user identifier), `block_timestamp` (timing of activity).

### Component C: Final ARPU aggregation

- **Purpose**: To normalize protocol revenue by the active user base.
- **Logic**: The daily protocol revenue in USD is divided by the total count of unique active users (daily). This result represents the average economic value generated by an individual user on a given day. In the event that no revenue or user activity is recorded for a specific period, the metric value is set to zero.
- **Key fields**: `revenue` (daily treasury share), `user_dau` (daily active user count).

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

CardanoADA

Average revenue per user (ARPU)

Average revenue per user (ARPU)

Competitive landscape