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.

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# grove Revenue Methodology

## 1. Overview

Revenue measures the total value generated by Grove Allocator through yield-bearing positions and incentive programs. This metric captures the gross income accrued to protocol-controlled accounts, including interest earned from yield-bearing assets and rewards claimed via Merkl. Revenue is equivalent to total fees as all generated value is currently retained by the protocol.

## 2. Data sources

- **Blockchain events**: `Claimed` events from `Distributor` contracts, covering Ethereum, Base, Avalanche, and Monad
- **Blockchain state**: `token` state calls from `PullTokenWrapper` contracts
- **External data**: End-of-day price feeds for underlying assets and yield indices for supported yield-bearing assets

## 3. Step-by-step calculation

### Component A: Yield-based income tracking

- **Purpose**: Calculate the interest accrued on yield-bearing assets held by Grove Allocator
- **Logic**: Daily balances are constructed for specific protocol-controlled addresses by aggregating net token flows. These balances are joined with daily yield indices to determine the interest accrued over each 24-hour period. The daily yield rate is calculated as the percentage change in the normalized yield index, which is then applied to the end-of-day balance to determine the yield-based income.
- **Key fields**: `token_balance`, `yield_index_normalized`, `daily_yield_rate`

### Component B: Incentive claim extraction

- **Purpose**: Capture rewards and incentives claimed through the Merkl distribution system
- **Logic**: `Claimed` events are parsed from `Distributor` contracts to identify incentive distributions. These events are filtered for specific Grove Allocator participant addresses. For wrapped incentive assets, the underlying asset is identified via `token` state calls from `PullTokenWrapper` contracts to ensure accurate asset categorization and pricing.
- **Key fields**: `claim_amount`, `claim_token_address`, `user_address`

### Component C: USD conversion and aggregation

- **Purpose**: Normalize all income components to USD and aggregate by day
- **Logic**: Yield-based income and incentive claims are combined and aggregated by asset and chain. Amounts are normalized by decimal precision and converted to USD using end-of-day price feeds. Daily granularity is maintained using UTC day boundaries.
- **Key fields**: `fees`, `revenue`, `price_usd`

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

fees * take_rate (illustrative — revenue is observed directly per project, not derived from take_rate)

Fee revenue retained after supply-side payouts. Before cost of revenue (e.g. L2 DA fees) and before operating expenses.

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Revenue

Revenue

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