# Gearbox V3 Active loans Methodology

## 1. Overview

Active loans measures the value of user deposits that are lent out to borrowers. The portion of deposits that borrowers must pay interest on is tracked, which correlates with the protocol's ability to generate revenue. For Gearbox V3, the outstanding principal borrowed from the lending pools is tracked, with accrued interest excluded.

## 2. Data sources

- **Blockchain events**: `Borrow` and `Repay` events from `PoolV3` contracts, ERC-20 token transfers, and daily pool state reads, covering Ethereum, Monad, and Plasma
- **External data**: End-of-day price feeds and asset metadata

## 3. Step-by-step calculation

### Component A: Monad ledger reconstruction

- **Purpose**: Reconstruction of daily pool and credit account balances on Monad using token flows and events.
- **Logic**: `Borrow` and `Repay` events are parsed from `PoolV3` contracts to capture raw borrow and repayment amounts. To identify the paying credit account for each repayment, ERC-20 token transfers to the lending pools are joined with the repayment transactions. Daily net token flows for pools and credit accounts are aggregated to calculate running balances. The outstanding principal (borrowed minus repaid) is then computed daily for each pool, credit manager, and account.
- **Key fields**: `amount`, `pool_address`, `credit_manager_address`, `account_address`

### Component B: State-based tracking for Ethereum and Plasma

- **Purpose**: Extraction of outstanding borrowed principal for pools on Ethereum and Plasma.
- **Logic**: Daily state reads of the total borrowed amounts are extracted directly from the pool contracts. The outstanding principal per pool is represented by these state reads, with accrued interest excluded.
- **Key fields**: `total_borrowed`, `pool_address`

### Component C: Decimal normalization and forward-filling

- **Purpose**: Normalization of raw token amounts and daily data continuity.
- **Logic**: Raw active loan amounts are normalized by the decimal precision of each pool's denomination asset using asset metadata. To prevent data gaps, the last known active loan balance for each pool is carried forward to subsequent days.
- **Key fields**: `active_loans`, `decimals`

### Component D: USD conversion and final aggregation

- **Purpose**: Conversion of normalized active loan values to USD and final aggregation.
- **Logic**: Normalized active loan balances are multiplied by end-of-day asset prices. The resulting USD values are aggregated daily by chain and product to represent the total active loans for Gearbox V3.
- **Key fields**: `active_loans`, `price_usd`

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

Value of loans currently outstanding to borrowers.

Active loans

Lending

Lenders deposit funds into Gearbox and receive interest payments from borrowers.

Gearbox is a non-custodial lending protocol built on Ethereum. Gearbox was founded by Mikhail Lazarev and launched in 2021.

GEAR tokenholders own and govern the protocol. They currently take a cut of the total interest paid by borrowers (revenue).

Gearbox V3

Active loans

Active loans

Chain breakdown