# dYdX V4 Fees Methodology

## 1. Overview

Fees measures the total value paid by users to interact with dYdX V4. This metric incorporates both trading fees collected during order execution and transaction fees paid to validators for processing operations on the dYdX Chain. These fees represent the total economic value generated by the protocol's activity and the cost incurred by users for utilizing dYdX V4 services.

## 2. Data sources

- **Blockchain events**: `match` events and transaction-level fee data from the dYdX Chain
- **External data**: End-of-day price feeds for the native asset

## 3. Step-by-step calculation

### Component A: Trading fee extraction

- **Purpose**: Captures the fees generated from perpetual contract trade matches on the dYdX V4 orderbook.
- **Logic**: `match` events are parsed from the system's message logs to extract taker and maker order fees. These values represent the quote-denominated quantums paid by participants for every executed trade. The taker and maker components are summed for each transaction to determine the total trading fee.
- **Key fields**: `block_timestamp` (timing), `taker_order_fee_raw` (taker fees), `maker_order_fee_raw` (maker fees)

### Component B: Transaction fee extraction

- **Purpose**: Captures the gas-related fees paid to the dYdX Chain for processing transactions.
- **Logic**: Transaction fees and tips are extracted from transaction records on the dYdX Chain. This includes the base fee and any additional tips paid by users to prioritize their operations. Failed transactions are excluded by filtering for non-null fee values.
- **Key fields**: `block_timestamp` (timing), `transaction_fee` (base gas fees), `transaction_tip` (priority fees)

### Component C: Normalization and USD conversion

- **Purpose**: Normalizes all fee components to USD for standardized reporting.
- **Logic**: Trading fees are normalized by decimal precision and aggregated as USD-denominated values. Transaction fees and tips are normalized by decimal precision and multiplied by end-of-day price feeds for the native asset. All values are aggregated to daily totals using UTC day boundaries.

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

Total value users pay to use a protocol (gross fees, user-paid fees).

Fees

Exchanges (DEX)

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 V4

Fees

Fees

Chain breakdown