# Fathom DEX Revenue Methodology

## 1. Overview

Revenue for Fathom DEX measures the protocol's share of the trading fees generated by users of the decentralized exchange. On Fathom DEX, a total fee is charged on every asset swap, of which a specific portion is allocated to the protocol treasury as revenue, while the remainder is distributed to liquidity providers as compensation for providing depth to the market. This metric represents the protocol's primary income stream from its exchange services before any operating expenses or token incentives are subtracted.

## 2. Data sources

- **Blockchain events**: `Swap` events from `Pair` contracts and `PairCreated` events from `Factory` contracts, covering XDC
- **External data**: End-of-day price feeds for traded assets

## 3. Step-by-step calculation

### Component A: Trading pair mapping

- **Purpose**: Identify active liquidity pools and their associated fee configurations.
- **Logic**: `PairCreated` events from `Factory` contracts are parsed to identify valid liquidity pool addresses and their constituent assets. A fee tier of 0.3% (3,000 basis points) is assigned to these pairs, representing the total swap fee paid by users of the exchange.
- **Key fields**: `token0_address`, `token1_address`, `account_address` (pool address), and `fee_tier`.

### Component B: Trading activity extraction

- **Purpose**: Calculate the total volume of asset swaps processed by the protocol.
- **Logic**: `Swap` events from `Pair` contracts are identified for all registered trading pairs. The amounts for both assets in a swap are extracted and the net change in balances is used to determine the trade size. These values are normalized by the decimal precision of each specific asset.
- **Key fields**: `amount0In`, `amount0Out`, `amount1In`, and `amount1Out`.

### Component C: USD normalization

- **Purpose**: Convert native trading volumes into a standardized USD value.
- **Logic**: Daily trading volumes for each asset are multiplied by their respective end-of-day price feeds. If the price for the primary asset in a swap is unavailable, the price of the secondary asset is used to ensure maximum coverage of trading activity.
- **Key fields**: `price_usd`, `timestamp`, and `trading_volume`.

### Component D: Fee and revenue calculation

- **Purpose**: Apply the protocol take rate to calculate retained revenue.
- **Logic**: Total fees are calculated by multiplying the USD-denominated trading volume by the pool fee tier of 0.3%. Fathom DEX revenue is then derived by applying a 5% protocol take rate to these total fees. This results in a protocol revenue equivalent to 0.015% of the total trading volume processed by the exchange.
- **Key fields**: `fees` and `revenue`.

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

fees * take_rate (illustrative — revenue is observed directly per project, not derived from take_rate)

Fee revenue retained after supply-side payouts. Before cost of revenue (e.g. L2 DA fees) and before operating expenses.