# dYdX Chain Token incentives Methodology

## 1. Overview

Token incentives measures the value of native assets distributed by dYdX Chain to its users, core contributors, and other stakeholders. For dYdX Chain, these distributions primarily originate from the community treasury and are intended to incentivize protocol growth and compensate participants. The metric is analogous to stock-based compensation in traditional finance and is converted to USD using end-of-day price feeds.

## 2. Data sources

- **Blockchain events**: `coin_spent` events from dYdX Chain
- **External data**: End-of-day price feeds for the native asset (adYdX)

## 3. Step-by-step calculation

### Component A: Treasury distribution identification

- **Purpose**: Capture the volume of native assets spent from the community treasury for incentive purposes.
- **Logic**: `coin_spent` events are parsed from dYdX Chain block data. These events are filtered to include only transactions where the spender matches the designated community treasury address. The asset amount is extracted from the event attributes by identifying the numeric values associated with the native `adydx` denomination.
- **Key fields**: `event_attributes` (containing spender and amount details), `block_timestamp` (timing).

### Component B: Asset normalization and USD conversion

- **Purpose**: Normalize raw blockchain data into a standard currency for analysis.
- **Logic**: Extracted asset amounts are normalized by decimal precision. These values are multiplied by end-of-day price feeds for the native asset to determine the USD value of the incentives. Data is aggregated to a daily granularity using UTC day boundaries.
- **Key fields**: `amount` (raw units), `price_usd` (valuation).

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

Value of native tokens distributed as incentives.

Token incentives

Blockchains (L1)

Market makers offer trades through order book & make money on bid-ask spreads (supply-side fees).

dYdX is a non-custodial trading and derivatives protocol initially built on Ethereum and later expanded to their own blcokchain built on top of the Cosmos SDK. dYdX was founded by Antonio Juliano and launched in 2017.

DYDX tokenholders own and govern the protocol. dYdX Trading Inc. currently takes all of the total trading fees paid by traders (revenue). dYdX’s investors include a16z, Polychain, The Spartan Group, etc.

dYdX Chain

Token incentives

Token incentives

Chain breakdown