Chainflip operates a decentralized network of 150 validators that collectively control multi-chain vaults using threshold signature schemes (TSS). The protocol uses a Just-In-Time (JIT) AMM where liquidity providers compete to fill swap orders at the moment of execution, enabling capital-efficient cross-chain swaps. A portion of each swap fee is used to buy and burn FLIP tokens.

Chainflip is a decentralized cross-chain swap protocol that enables native asset exchanges across blockchains including Bitcoin, Ethereum, and Solana without wrapped tokens or traditional bridges. It was launched in 2023 by Chainflip Labs and uses a JIT AMM model combined with MPC-based vault technology to provide competitive pricing on cross-chain trades.

Chainflip is governed by its validator set and FLIP tokenholders. Validators stake FLIP to participate in the network and earn fees from swaps. The protocol is developed and maintained by Chainflip Labs.

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Chainflip

# Chainflip Supply-side fees Methodology

## 1. Overview

Supply-side fees is defined as the share of fees that is distributed to service providers on Chainflip. This metric is used to track the compensation earned by brokers on Chainflip DEX and liquidity providers on Chainflip Lending. These fees are allocated to incentivize participation and liquidity provision across the protocol's products. All collected fees are normalized by decimal precision and converted to USD.

## 2. Data sources

- **Blockchain events**: `SwapExecuted` events from `swapping` contracts, and `InterestTaken`, `OriginationFeeTaken`, and `LiquidationFeeTaken` events from `lendingPools` contracts on Chainflip Chain
- **External data**: End-of-day price feeds for asset valuation

## 3. Step-by-step calculation

### Component A: Chainflip DEX broker fee extraction

- **Purpose**: To capture fees paid to brokers facilitating swaps on Chainflip DEX.
- **Logic**: `SwapExecuted` events are parsed from `swapping` contracts for transactions occurring after the runtime upgrade. The broker fee is extracted from the event data, normalized by USDC decimal precision, and aggregated. For historical events prior to the runtime upgrade, broker fees are assumed to be zero.
- **Key fields**: `broker_fee_usdc`

### Component B: Chainflip Lending supply fee extraction

- **Purpose**: To capture interest, origination, and liquidation fees allocated to liquidity providers on Chainflip Lending.
- **Logic**: `InterestTaken` events are parsed from `lendingPools` contracts to extract raw supply-side interest fee components. Additionally, `OriginationFeeTaken` and `LiquidationFeeTaken` events are parsed from `lendingPools` contracts to extract raw supply-side fee amounts. These raw amounts are combined, mapped to their respective assets using loan metadata, and normalized by the decimal precision of each asset.
- **Key fields**: `supply_amount_raw`, `fee_supply_amount_raw`, `loan_id`, `asset`

### Component C: USD conversion and aggregation

- **Purpose**: To normalize all supply-side fees to USD and aggregate them.
- **Logic**: The normalized broker fees from Chainflip DEX and supply fees from Chainflip Lending are aggregated daily. These values are multiplied by end-of-day asset prices to convert them to USD. Daily values are aggregated with UTC day boundaries.

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

Portion of fees distributed to service providers or supply-side participants.

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Supply-side fees

Supply-side fees

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