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Dolomite

# Dolomite Expenses Methodology

## 1. Overview

The Dolomite expenses metric measures the total operating costs incurred by the protocol on a daily basis. This includes direct costs of revenue (primarily oARB token payouts), token incentives distributed to users, and bad debt losses from underwater positions that cannot be liquidated. The metric provides insight into the protocol's operational efficiency and risk management effectiveness across all supported chains (Arbitrum, Base, Ink, Berachain, and Ethereum).

## 2. Data sources

- **oARB position events**: Parsed `VesterProxy_PositionClosed_event` and `VesterProxy_VestingPositionCreated_event` logs from Arbitrum capturing option exercise activities
- **Bad debt events**: Parsed `DolomiteMargin_LogVaporize_event` logs from Arbitrum, Base, Ink, Berachain, and Ethereum representing forced liquidations of underwater positions
- **Market configuration**: Parsed `DolomiteMargin_LogAddMarket_event` logs from all chains providing market ID to token mappings
- **Price feeds**: End-of-day token price feeds for USD conversion
- **Internal market prices**: Dolomite's internal market pricing data from the states system as backup pricing
- **Token metadata**: Token symbols, decimal places, and contract addresses for proper amount conversion

## 3. Step-by-step calculation

### Component A: oARB cost of revenue
- **Purpose**: Tracks the cost of ARB tokens paid out when users exercise oARB (options on ARB) positions
- **Logic**: Match `VesterProxy_VestingPositionCreated_event` logs with corresponding `VesterProxy_PositionClosed_event` logs using the `vesting_id` field. When a position is closed, extract the ARB token `amount` from the original creation event. Convert the raw token amount by dividing by 10^18 (ARB has 18 decimals). Multiply by the end-of-day ARB price to get USD value. Sum all exercised positions by day.
- **Key fields**: `vesting_id` for matching events, `amount` for ARB tokens paid, `block_timestamp` for daily aggregation

### Component B: Token incentives
- **Purpose**: Tracks token rewards distributed to protocol users
- **Logic**: Currently set to zero as Dolomite does not distribute token incentives. Creates zero values for all dates and chains to maintain consistent schema structure.
- **Key fields**: All values set to 0

### Component C: Bad debt costs  
- **Purpose**: Measures protocol losses from positions that become too underwater to liquidate normally
- **Logic**: Process `DolomiteMargin_LogVaporize_event` logs which represent forced liquidations of underwater positions. Extract the `bad_debt_amount` from the `vaporOwedUpdate.deltaWei.value` field. Join with market configuration data using `market_id` to get token address and decimals. Convert raw amount by dividing by 10^(token_decimals). Convert to USD using end-of-day price feeds, with Dolomite's internal market prices as fallback when standard prices are unavailable. Sum all vaporization losses by day and chain.
- **Key fields**: `owedMarket` for token identification, `vaporOwedUpdate.deltaWei.value` for debt amount, `block_timestamp` for daily aggregation

### Final aggregation
- **Combining components**: Union all three expense components (oARB cost of revenue, token incentives, bad debt costs) into a single dataset, maintaining daily granularity and chain separation
- **Currency conversion**: All amounts converted to USD using end-of-day price feeds with internal market prices as backup
- **Time aggregation**: Events aggregated to daily totals using timestamp truncation to day boundaries
- **Final calculation**: Sum of oARB payouts + token incentives + bad debt losses per day per chain, with zero-filling for dates with no activity to ensure continuous time series

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

Total project operating and incentive expenses.

DolomiteDOLO

Expenses

Expenses

Competitive landscape

Chain breakdown