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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Derivative exchanges

dYdX

# dYdX Supply-side fees Methodology

## 1. Overview

Supply-side fees represent the portion of total protocol fees that are distributed to liquidity providers or network validators. For dYdX, this metric captures only blockchain transaction fees since 0% of DEX trading fees go to liquidity providers - market makers are instead incentivized through bid-ask spreads. On the dYdX blockchain, all transaction fees are distributed to validators as the community tax is set to 0%, making these fees qualify as supply-side revenue.

## 2. Data sources

The calculation uses the following data sources:
- **dYdX blockchain transaction records**: Individual transaction data including `transaction_fee` and `transaction_tip` amounts from the dYdX chain
- **End-of-day price feeds**: Token price data from CoinGecko for the `dydx-chain` token to enable USD conversion
- **DEX trading data**: Various trading fee sources (API data, manual entries, dYdX V4 match events) that are excluded from supply-side calculation but used to understand the complete fee landscape

## 3. Step-by-step calculation

### Component A: Blockchain transaction fee extraction
- **Purpose**: Extract and clean raw transaction fee data from the dYdX blockchain
- **Logic**: Process individual blockchain transactions to extract `transaction_fee` and `transaction_tip` amounts. Filter out failed transactions where `transaction_fee` is null. Combine fee and tip amounts to get total transaction fees paid by users.
- **Key fields**: `transaction_fee`, `transaction_tip`, `block_timestamp`, `transaction_hash`

### Component B: Daily fee aggregation
- **Purpose**: Aggregate individual transaction fees into daily totals
- **Logic**: Group transactions by day using `timestamp_trunc` on `block_timestamp`. Sum all `transaction_fee` amounts within each day to get total daily blockchain fees. Convert from raw 18-decimal format to native token units by dividing by 10^18.
- **Key fields**: Daily aggregated `fees` amount, `timestamp` (truncated to day), `chain_id` as 'dydx'

### Component C: USD conversion
- **Purpose**: Convert native token fees to USD for standardized reporting
- **Logic**: Join daily fee amounts with end-of-day CoinGecko price data for the `dydx-chain` token. Multiply native token fee amounts by the corresponding daily USD price to get USD-denominated fee values.
- **Key fields**: `fees` in USD, `coingecko_id` as 'dydx-chain'

### Component D: Product categorization and filtering
- **Purpose**: Categorize different fee types and filter for supply-side calculation
- **Logic**: Tag blockchain fees with `product_id` as 'blockchain' to distinguish from DEX trading fees which use `product_id` values like 'dYdX V3' or 'dYdX V4'. The dYdX fees model combines multiple fee sources (blockchain, DEX dYdX V3, DEX dYdX V4) but the supply-side calculation filters to only include blockchain fees since DEX trading fees don't go to liquidity providers.
- **Key fields**: `product_id`, `business_segment_id`, `market_sector_id`

### Final aggregation
- **Combining components**: Only blockchain transaction fees (product_id = 'blockchain') are included in the final supply-side calculation, effectively filtering out all DEX trading fees
- **Currency conversion**: USD conversion happens at the daily level using end-of-day CoinGecko prices for the dydx-chain token
- **Time aggregation**: Data is aggregated to daily boundaries using day-truncated timestamps
- **Final calculation**: The final supply-side fees value equals the sum of all daily blockchain transaction fees in USD, with no DEX trading fees included since they don't flow to liquidity providers

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

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

dYdXDYDX

Supply-side fees

Supply-side fees

Competitive landscape

Chain breakdown