# Gearbox V3 Total value locked Methodology

## 1. Overview

Total value locked (TVL) is calculated as the sum of pool expected liquidity and borrower equity within Gearbox V3. Pool expected liquidity is defined as the total assets deposited by lenders, while borrower equity is determined by subtracting outstanding debt from the total collateral held in active credit accounts. This metric is utilized as a primary indicator of the protocol's capacity to support leveraged trading, borrowing, and yield-generating activities.

## 2. Data sources

- **Blockchain events**: `Borrow` and `Repay` events from `PoolV3` contracts, ERC-20 asset transfers, and daily blockchain state snapshots of credit account books, credit account debts, pool liquidity, and pool borrows, covering Ethereum, Monad, and Plasma
- **External data**: End-of-day price feeds and asset metadata

## 3. Step-by-step calculation

### Component A: Pool expected liquidity tracking

- **Purpose**: Capture the total assets deposited into Gearbox V3 lending pools.
- **Logic**: For Ethereum and Plasma, pool expected liquidity is extracted from daily blockchain state snapshots. For Monad, pool expected liquidity is reconstructed by summing pool cash balances (derived from ERC-20 asset transfers) and outstanding borrowed principal. Only pools associated with Gearbox V3 (versions v3.0 and v3.1) are included.
- **Key fields**: `pool_address`, `token_address`, `expected_liquidity`

### Component B: Borrower equity calculation

- **Purpose**: Calculate the net equity of borrowers across active credit accounts.
- **Logic**: Borrower equity is calculated as the total value of collateral held in credit accounts minus outstanding debt. For Ethereum and Plasma, collateral and debt balances are extracted from daily credit account book and debt state snapshots. For Monad, collateral and debt are reconstructed from historical asset flows and `Borrow` and `Repay` events from `PoolV3` contracts. Debt is calculated as principal plus accrued interest, except on Monad where only principal is used.
- **Key fields**: `credit_manager_address`, `account_address`, `token_address`, `amount`

### Component C: Collateral adjustments and exclusions

- **Purpose**: Adjust collateral values for staked wrappers, Curve LP positions, and excluded assets.
- **Logic**: Staked positions held as non-transferable wrappers (such as staked Curve LP or staked USDS) are mapped and valued 1:1 as their underlying staked assets. Curve LP collateral on Monad and Plasma is valued at net asset value (NAV) based on the underlying asset balances of the Curve pools, while LP assets on other chains are valued using their direct market prices. Specific assets with no recoverable value, such as Stream Finance xUSD on Plasma after its depeg, are excluded and valued at zero.
- **Key fields**: `wrapper_address`, `staked_token_address`, `lp_address`, `coins_per_lp`

### Component D: USD conversion and final aggregation

- **Purpose**: Normalize all balances to USD and aggregate to calculate total TVL.
- **Logic**: All native asset amounts are normalized by decimal precision. Non-USD balances are converted to USD using end-of-day price feeds, while borrower equity already denominated in USD is kept at its face value. The final TVL is calculated by summing the USD-denominated pool expected liquidity and borrower equity across all supported chains. Missing daily values are filled forward using the last known state, and daily values are aggregated with UTC day boundaries.
- **Key fields**: `tvl`, `amount_usd`, `timestamp`

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

Total value locked (TVL)

Total value locked (TVL) — value deposited into the project's applications.

Total value locked

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

Total value locked

Total value locked

Chain breakdown