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).

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Cardano

# Cardano Average transaction fee Methodology

## 1. Overview

Average transaction fee measures the average fee users pay per transaction on Cardano. It reflects the typical cost associated with utilizing the network for asset transfers or smart contract interactions. This metric provides a standardized view of network affordability and is used to monitor changes in the economic environment of the Cardano blockchain.

## 2. Data sources

- **Blockchain events**: Transaction records from the Cardano network, covering Cardano
- **External data**: End-of-day price feeds for the native ADA asset

## 3. Step-by-step calculation

### Component A: Fee extraction and normalization

- **Purpose**: To capture the total value of fees paid to the network in a standardized currency.
- **Logic**: Fees are extracted from transaction records. Since fees are originally denominated in Lovelace, amounts are normalized by decimal precision to represent values in the native ADA asset. These values are converted to USD using end-of-day price feeds. Total daily fees are calculated by summing the USD value of all transaction fees within a UTC day.
- **Key fields**: `block_timestamp`, `transaction_hash`, `fees`

### Component B: Transaction volume tracking

- **Purpose**: To determine the total number of transactions processed by the network.
- **Logic**: The total transaction count is determined by counting unique transaction hashes from the transaction records. Data is aggregated at a daily granularity based on the block timestamp.
- **Key fields**: `block_timestamp`, `transaction_hash`

### Component C: Average fee derivation

- **Purpose**: To calculate the mean cost per transaction.
- **Logic**: The total daily fees (expressed in USD) are divided by the total daily transaction count. This calculation is performed at a daily granularity. The final output is processed to ensure data continuity and to fill any gaps in the time series.
- **Key fields**: `fees`, `transaction_count`

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

CardanoADA

Average transaction fee

Average transaction fee

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