# Euler Lending Fees Methodology

## 1. Overview

Fees measures the total interest paid by borrowers to the Euler Lending protocol. This value represents the gross economic activity generated by the platform's lending markets. Collected fees are algorithmically distributed between the protocol (revenue) and the liquidity providers (supply-side fees) based on a market-specific interest fee factor. Fees are captured across multiple blockchain deployments and are normalized to USD for comparative analysis.

## 2. Data sources

- **Blockchain events**: `VaultStatus`, `ConvertFees`, and `GovSetInterestFee` events from `EVault` contracts, and `ProxyCreated` events from `EVaultFactory` contracts, covering Ethereum, Arbitrum, Base, Avalanche, and 6 other chains
- **External data**: End-of-day price feeds for supported assets, including a dedicated fallback mechanism for assets on the Bob chain

## 3. Step-by-step calculation

### Component A: Market and asset identification

- **Purpose**: Map active lending markets to their underlying collateral and borrow assets
- **Logic**: `ProxyCreated` events from `EVaultFactory` contracts are parsed to identify the relationship between market proxy addresses and their corresponding underlying assets. This mapping ensures that interest accrual is attributed to the correct asset and chain.

### Component B: Interest fee factor tracking

- **Purpose**: Determine the percentage of interest allocated to the protocol
- **Logic**: `GovSetInterestFee` events from `EVault` contracts are monitored to track changes in the interest fee factor (the protocol's take rate) for each market. A default factor of 10% is applied to markets where no explicit fee update has been recorded. These factors are filled forward to ensure a continuous record is available for daily fee distributions.

### Component C: Protocol fee accumulation and delta tracking

- **Purpose**: Calculate the protocol's share of interest on a daily basis
- **Logic**: `VaultStatus` events from `EVault` contracts are tracked to monitor the `accumulated_fees` field. Daily revenue is determined by calculating the difference between the current and previous accumulated fee values. In instances where the accumulated fees are reset to zero (signaling a conversion into shares), the `protocol_shares` and `governor_shares` from `ConvertFees` events are used to calculate the realized delta.

### Component D: Total fee derivation and normalization

- **Purpose**: Back-calculate the total interest paid by borrowers and normalize the value
- **Logic**: The protocol's fee delta is multiplied by an exchange rate, defined as the ratio of the vault's total assets (cash plus total borrows) to the total shares. Total fees are then derived by dividing this protocol revenue by the interest fee factor, effectively capturing the 100% value of interest paid before any protocol splits. All amounts are normalized by the decimal precision of the underlying asset.

### Component E: USD conversion and aggregation

- **Purpose**: Convert asset-denominated interest into a standardized USD value
- **Logic**: Normalized fee amounts are multiplied by end-of-day asset price feeds. For assets on the Bob chain not present in standard feeds, a dedicated fallback mechanism is utilized to ensure comprehensive coverage. Data is aggregated to daily granularity 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

Lending

Lenders deposit funds into Euler and receive interest payments from borrowers (supply-side fees).

Euler is a non-custodial lending protocol built on Ethereum. Euler was founded by Michael Bentley, Doug Hoyte & Jack Prior and launched in 2021.

EUL tokenholders own and govern the protocol. They currently take a cut of the total interest paid by borrowers (revenue). Euler’s investors include Paradigm, Lemniscap, Launchhub Ventures, etc.

Euler Lending

Fees

Fees

Chain breakdown