Stakers deposit funds into Frax and receive a return on investment in the form of staking rewards (supply-side fees).


Frax Ether is a liquid staking derivative product created by the Frax Finance protocol. Frax Finance was founded by Sam Kazemian, Stephen Moore, Jason Huoan & Travis Moore and launched in 2019.


FRAX tokenholders own and govern the Frax Finance protocol, including the Frax Ether business line. They currently take a cut of the total staking rewards earned by the protocol (revenue). Frax’s investors include Crypto.com Capital & Ascensive Assets.


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Liquid staking

Frax Ether

# Frax Ether Fees Methodology

## 1. Overview

The FRAX fees metric represents the total fees generated by the FRAX protocol's liquid staking operations, primarily through staked Ethereum (frxETH) rewards. The calculation captures reward distributions to sfrxETH stakers and extrapolates total protocol fees by assuming supply-side participants receive 90% of total fees generated. This metric measures the protocol's ability to generate revenue from its liquid staking services.

## 2. Data sources

- **Blockchain events**: Parsed Ethereum `SfrxETH_NewRewardsCycle` events from the sfrxETH contract that capture reward distribution cycles
- **Token metadata**: Token decimal precision data for proper amount calculations
- **External data**: End-of-day token price feeds for USD conversion, using WETH as the pricing reference token

## 3. Step-by-step calculation

### Component A: Reward event extraction
- **Purpose**: Extract all reward distributions from FRAX liquid staking operations
- **Logic**: Parse Ethereum blockchain events from the sfrxETH contract (`0x5e8422345238f34275888049021821e8e08caa1f`) to identify `SfrxETH_NewRewardsCycle` events. Filter out removed/invalid events and extract the `rewardAmount` field which represents rewards paid to stakers. Classify these as liquid staking business segment with frxETH as the product name.
- **Key fields**: `rewardAmount` (raw reward distributed), `block_timestamp` (when reward was distributed), `transaction_hash` and `log_index` (for uniqueness)

### Component B: Supply-side fee aggregation  
- **Purpose**: Calculate daily supply-side fees from reward distributions
- **Logic**: Aggregate extracted reward amounts by day using timestamp truncation to daily boundaries. Convert token amounts from native decimals to standardized format using token metadata. Convert amounts to USD using end-of-day WETH price feeds since rewards are denominated in ETH-equivalent value. Apply business metadata classification for liquid staking segment.
- **Key fields**: `fees_supply_side` (USD value of daily rewards to stakers), `timestamp` (daily boundary), `chain_id` (Ethereum)

### Final aggregation
- **Combining components**: Use the daily supply-side fees as the base for total fee calculation
- **Currency conversion**: All amounts converted to USD using end-of-day WETH price feeds with proper decimal adjustment
- **Time aggregation**: Data aggregated to daily boundaries using timestamp truncation
- **Final calculation**: Total fees calculated as supply-side fees divided by 0.9, based on the assumption that stakers receive 90% of total protocol fees while the protocol retains 10% as revenue (total_fees = supply_side_fees / 0.9)

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

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

Frax Ether

Fees

Fees

Competitive landscape

Chain breakdown