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.

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dYdX

# dYdX Earnings Methodology

## 1. Overview

dYdX earnings represents the net profit generated by the dYdX protocol ecosystem, calculated as total revenue minus total expenses. This metric measures the protocol's financial performance by subtracting token incentive costs from trading fee income across all dYdX product versions (dYdX V3 on StarkEx, dYdX V4 on dYdX chain, and legacy systems). The calculation provides insight into the protocol's ability to generate sustainable profits after accounting for user acquisition and retention costs through token rewards.

## 2. Data sources

The earnings calculation draws from multiple raw blockchain and external data sources:

**Blockchain events and transactions:**
- dYdX chain `coin_spent` events from the community treasury address for token incentive distributions
- dYdX chain `match` events containing maker and taker trading fees for dYdX V4 perpetual trading
- dYdX chain transaction records including fees and tips
- Ethereum parsed contract events from LiquidityStaking, SafetyModule, and MerkleDistributor contracts for DYDX token reward claims

**Trading activity data:**
- Hourly trading fee data from dYdX API scraping
- Manual historical fee data provided by the dYdX team for early periods
- Legacy revenue data from previous data pipelines

**External price data:**
- End-of-day token price feeds from CoinGecko for USD conversion of DYDX token amounts

## 3. Step-by-step calculation

### Component A: Revenue calculation
- **Purpose**: Aggregate all trading fee revenue across dYdX products while excluding blockchain-level fees
- **Logic**: Combines trading fees from five main sources. Manual historical fees cover early dYdX V3 periods on StarkEx with team-provided daily totals. API-scraped hourly fees are processed by taking daily snapshots at specific UTC hours (00:00, 01:00, or 02:00) to capture 24-hour rolling totals, with manual overrides applied for data quality fixes. Legacy revenue data provides historical dYdX V3 fees from previous data systems. dYdX chain transaction fees include all network-level fees and tips paid by users. dYdX V4 trading fees come from `match` events on dYdX chain, extracting maker and taker fee quantum amounts in USDC denomination. All fee sources are filtered to exclude blockchain infrastructure fees (where `product_id` != 'blockchain') to focus on DEX protocol revenue
- **Key fields**: `fee_amount` from API data, `transaction_fee` and `transaction_tip` from chain transactions, `maker_order_fee_raw` and `taker_order_fee_raw` from match events, manual fee overrides for specific date ranges

### Component B: Expenses calculation  
- **Purpose**: Calculate total token incentive expenses paid out in DYDX tokens across all reward programs
- **Logic**: Combines token incentives from two main categories. DEX token incentives track DYDX reward claims on Ethereum from liquidity staking programs (`LiquidityStaking_ClaimedRewards` events), safety module rewards (`SafetyModuleV2_ClaimedRewards` events), and merkle distributor claims (`MerkleDistributor_RewardsClaimed` events), excluding returns to the community treasury address. Blockchain token incentives track community treasury distributions on dYdX chain through `coin_spent` events from the treasury address, filtering for DYDX token payments by matching the 'adydx' denomination pattern. Raw token amounts are converted from microunits to standard units by dividing by appropriate decimal factors
- **Key fields**: `amount` from blockchain events, `claimedRewards` and `amount` from Ethereum contract events, `spender` and `amount` extraction from event attributes using JSON parsing and regex patterns

### Final aggregation
- **Combining components**: Revenue and expense components are calculated separately as daily totals, then combined using the earnings formula where daily earnings equals daily revenue minus daily expenses for the same date
- **Currency conversion**: All non-USD amounts converted to USD using end-of-day CoinGecko price feeds matched by date, with DYDX token prices from 'dydx-chain' identifier and USDC amounts treated as 1:1 USD equivalent
- **Time aggregation**: All data aggregated to daily boundaries using timestamp truncation to day level, with consistent UTC timezone handling across all sources
- **Final calculation**: Daily earnings calculated as the simple subtraction of total daily token incentive expenses from total daily trading fee revenue, with zero-filling applied to ensure continuous daily time series without gaps

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

Net profit (also profits, net income, profitability) — revenue remaining after subtracting expenses.

dYdXDYDX

Earnings

Earnings

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