# Grove Allocator Fees Methodology

## 1. Overview

Fees measures the total value generated by assets managed through Grove Allocator. This includes both the organic yield accrued from underlying DeFi positions and external incentives claimed from liquidity management platforms such as Merkl. The metric reflects the gross income generated by the protocol's allocated capital before any expenses or revenue-sharing distributions are applied.

## 2. Data sources

- **Blockchain events**: `Claimed` events from `Distributor` contracts, covering Ethereum
- **Blockchain data**: Daily asset net flows for specific Grove Allocator vault and holder addresses, covering Ethereum, Base, Avalanche, and Monad
- **External data**: End-of-day price feeds and standardized yield index data for supported assets

## 3. Step-by-step calculation

### Component A: Position balance tracking

- **Purpose**: Establish the daily quantity of assets held by Grove Allocator as the basis for yield calculation
- **Logic**: Daily token balances are calculated for specific holder addresses by aggregating net token flows from on-chain activity. A continuous daily record is maintained by forward-filling balances across a date spine, ensuring that holdings are accurately represented even on days without active transfers. Only positive balances are retained for fee calculations.
- **Key fields**: `holder_address`, `token_address`, `token_balance`

### Component B: Yield-based fee accrual

- **Purpose**: Calculate the organic yield generated by allocated assets
- **Logic**: Daily yield rates are derived from the day-over-day change in a normalized yield index for each supported asset. These rates are applied to the daily token balances calculated in Component A. Only positive accruals (where the current index exceeds the previous day's index) are classified as fees.
- **Key fields**: `yield_index_normalized`, `daily_yield_rate`, `position_fees`

### Component C: Incentive claim extraction

- **Purpose**: Capture additional income from external incentive programs
- **Logic**: Incentive-based fees are captured by parsing `Claimed` events from `Distributor` contracts on Ethereum. These events are filtered to include only those where the recipient matches authorized Grove Allocator holder addresses. Amounts are normalized by the decimal precision of the claimed asset and mapped to the corresponding yield-generating positions.
- **Key fields**: `claim_token_address`, `claim_amount`, `user_address`

### Component D: USD conversion and aggregation

- **Purpose**: Normalize all fee components into a single currency for reporting
- **Logic**: Native fee amounts from yield accruals and incentive claims are multiplied by end-of-day asset prices. If a direct price is unavailable, backup price feeds or metadata-based valuations are applied. The resulting values are aggregated by day, chain, and income type (yield or incentive) to produce the final metric.
- **Key fields**: `price_usd`, `fees`

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

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

Fees

Asset management

Grove borrows via Sky's Allocator Module and deploys capital into curated yield strategies through an ALM (Asset-Liability Management) controller architecture. The protocol generates yield across its positions while management fees are settled off-chain via a Monthly Settlement Cycle between Grove and Sky DAO.

Grove operates as a programmable capital allocator that draws stablecoins from Sky Protocol and deploys them into diversified institutional-grade yield-bearing positions spanning tokenized treasuries, private credit, DeFi lending markets, and curated vaults across multiple chains.

Grove is a DeFi protocol built on Sky (formerly MakerDAO) infrastructure, incubated by Grove Labs and managed by Steakhouse Financial as risk curator.

Grove Allocator

Fees

Fees

Chain breakdown