# Flow Supply-side fees Methodology

## 1. Overview

Supply-side fees measures the share of transaction fees that is distributed to service providers, specifically the validators responsible for securing the network. For Flow EVM, all collected fees are allocated to the supply-side to compensate validators. For Flow, supply-side fees is set to zero as transaction fees are classified as protocol revenue or utilized as inflation offsets rather than being distributed directly to validators.

## 2. Data sources

- **Blockchain events**: Transaction records and gas usage data from the Flow and Flow EVM networks
- **External data**: End-of-day price feeds for the native Flow asset

## 3. Step-by-step calculation

### Component A: Flow EVM fee extraction

- **Purpose**: Capture the total fees paid by users on the Flow EVM environment for distribution to validators.
- **Logic**: Transaction records are parsed from Flow EVM to extract the gas consumed and the gas price for every transaction. The fee for each transaction is calculated by multiplying the gas used by the gas price. 100% of these fees are attributed to the supply-side, reflecting the distribution of EVM-based transaction fees to the underlying network validators.
- **Key fields**: `gas_used`, `gas_price`

### Component B: Flow fee allocation

- **Purpose**: Determine the supply-side portion of native transaction fees on Flow.
- **Logic**: Supply-side fees for native transactions is hardcoded to zero. Although fees are collected from transaction payers, these amounts are not distributed to the supply-side. Instead, native fees are treated as protocol-level revenue or used to offset token inflation.
- **Key fields**: `fee_amount`

### Component C: USD conversion and final aggregation

- **Purpose**: Normalize all fee values to USD for consistent reporting.
- **Logic**: Fee amounts from both environments are normalized by decimal precision. Native Flow values are multiplied by end-of-day price feeds. The resulting values are aggregated into daily totals using UTC day boundaries.

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

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

Supply-side fees

Blockchains (L1)

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

Flow is a smart contract platform for decentralized applications (a blockchain). Flow was founded by Roham Gharegozlou, Dieter Shirley and Mikhael Naayem and launched in 2019.

FLOW holders own and govern the protocol. They currently don’t take a cut of the total transaction fees paid by users (revenue). Flow’s investors include a16z, Coatue, Coinfund, Fabric Ventures, etc.

Flow

Supply-side fees

Supply-side fees

Chain breakdown