Validators process transactions and receive fees from users (supply-side fees).

Fantom is a smart contract platform for decentralized applications (a blockchain). Fantom was founded by Dr. Ahn Byung Ik and launched in 2019.

FTM holders own and govern the protocol. They currently take a cut of the total transaction fees paid by users (revenue). Fantom’s investors include DHVC, Arrington XRP Capital, 8 decimal Capital, etc.

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# Fantom Supply-side fees Methodology

## 1. Overview

Supply-side fees represent the portion of total network fees that flow to network validators as rewards for securing and maintaining the Fantom blockchain. This metric calculates the daily USD value of fees earned by Fantom validators, which represents 70% of all gas fees paid on the network. This business question helps understand the economic incentives and revenue distribution within the Fantom network's proof-of-stake consensus mechanism.

## 2. Data sources

- **Fantom blockchain transaction records**: Complete transaction history including gas usage metrics and effective gas prices paid
- **End-of-day WFTM token price feeds**: Daily closing prices for Wrapped Fantom (WFTM) tokens used for USD conversion
- **Token metadata**: WFTM contract information and decimal precision data

## 3. Step-by-step calculation

### Component A: Transaction data extraction
- **Purpose**: Extract all Fantom network transactions with gas fee information
- **Logic**: Retrieve all transactions from the Fantom blockchain including gas usage and pricing data. Each transaction contains the amount of gas consumed (`gas_used`) and the effective price paid per unit of gas (`effective_gas_price`). The effective gas price is converted from wei to FTM by dividing by 10^18. Additional metadata is added including chain identification, market sector classification as blockchains layer 1, and business segment as blockchain. The WFTM token address `0x21be370d5312f44cb42ce377bc9b8a0cef1a4c83` is assigned as the fee token since gas fees are paid in FTM.
- **Key fields**: `block_timestamp`, `gas_used`, `effective_gas_price`, `transaction_hash`, `from_address`, `to_address`

### Component B: Daily fee aggregation  
- **Purpose**: Calculate total gas fees paid per day across the Fantom network
- **Logic**: Group all transactions by day using timestamp truncation to daily boundaries. For each day, calculate the total gas fees by summing the product of `gas_used` multiplied by `effective_gas_price` across all transactions. This produces the total daily fee amount paid by users to execute transactions on the Fantom network.
- **Key fields**: `timestamp` (daily), `fee_amount` (total daily fees in FTM)

### Component C: USD conversion and metadata enrichment
- **Purpose**: Convert fee amounts to USD and add metric metadata structure
- **Logic**: Apply end-of-day WFTM token prices to convert daily fee amounts from native FTM to USD equivalent values. Add standardized metric metadata including timestamp grain as day, market sector identification as blockchains layer 1, business segment as blockchain, chain identifier as fantom, and token address for WFTM. The conversion uses the convert to USD macro which handles decimal precision and price application.
- **Key fields**: `fees` (USD-denominated fee amounts), `timestamp_grain`, `market_sector_id`, `business_segment_id`, `chain_id`, `token_address`

### Final aggregation
- **Combining components**: The USD-denominated total fees flow directly into the supply-side calculation without additional joining or combination
- **Currency conversion**: All amounts are converted to USD using end-of-day WFTM prices applied through the standard Token Terminal conversion methodology
- **Time aggregation**: Data is aggregated to daily boundaries using timestamp truncation, with each day representing a complete 24-hour period
- **Final calculation**: Supply-side fees are calculated by multiplying total daily fees by the validator fee share of 70% (0.7). This reflects Fantom's consensus mechanism where validators receive 70% of all gas fees as rewards for block production and network security. The remaining 30% goes to other network participants or is burned. The final metric represents the daily USD value earned by Fantom validators from transaction fees.

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

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

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