# Hydration DEX Fees Methodology

## 1. Overview

Fees measures the total value paid by users to interact with the Hydration ecosystem. For Hydration DEX, this primarily consists of trading fees paid by swappers to liquidity providers and the protocol. The metric also encompasses transaction fees and tips paid on Hydration Substrate, interest and liquidation fees generated within Hydration Lending, and stability fees associated with HOLLAR. These fees represent the total economic value generated by the suite of products and are used to compensate supply-side participants and the protocol treasury.

## 2. Data sources

- **Blockchain events**: `TransactionFeePaid` events from Substrate system logs, `Swapped`, `Swapped2`, and `Swapped3` events from `broadcast` pallets, `MintedToTreasury`, `LiquidationCall`, and `ReserveDataUpdated` events from `LendingPool` contracts, and `Mint` and `Burn` events from `VToken` contracts, covering Hydration Substrate and Hydration EVM
- **External data**: End-of-day price feeds for various assets and native gas assets

## 3. Step-by-step calculation

### Component A: Hydration Substrate transaction fees

- **Purpose**: Capture the cost of executing transactions and prioritizations on the Hydration Substrate chain
- **Logic**: `TransactionFeePaid` events are parsed to extract the base fee `amount` and any optional `tip` paid by the user. These two values are summed for every successful extrinsic. The resulting values are normalized by the native decimal precision of 12 and aggregated to a daily grain.
- **Key fields**: `amount`, `tip`, `block_timestamp`

### Component B: Hydration DEX trading fees

- **Purpose**: Calculate the total fees paid by users during asset swaps on Hydration DEX
- **Logic**: `Swapped`, `Swapped2`, and `Swapped3` events are parsed from the `broadcast` pallet. Fee amounts and their corresponding asset identifiers are extracted for both input and output legs of the trade. These amounts are normalized by the specific decimal precision of each asset and aggregated by day.
- **Key fields**: `fees_assets_amount_1`, `fees_asset_1`, `fees_assets_amount_2`, `fees_asset_2`, `timestamp`

### Component C: Hydration Lending and HOLLAR fees

- **Purpose**: Capture interest accruals, liquidation penalties, and stability fees from lending and stablecoin products
- **Logic**: For Hydration Lending, protocol revenue is tracked via `MintedToTreasury` events and state-level treasury accruals. Total fees are derived by dividing this revenue by the reserve factor to account for the supply-side portion. Liquidation fees are captured by identifying `LiquidationCall` events and tracking subsequent collateral transfers to the treasury. For HOLLAR, interest fees are calculated by applying the percentage change in the variable borrow index to the cumulative debt balance. Stability module fees are tracked through native token transfers to the stability module address.
- **Key fields**: `in_amountMinted`, `variable_borrow_index`, `liquidation_factor`, `in_balanceIncrease`

### Component D: USD conversion and final aggregation

- **Purpose**: Normalize all collected fee components into a single currency for reporting
- **Logic**: Fee amounts in their respective base units are multiplied by end-of-day price feeds. All components from the DEX, Substrate chain, Lending, and HOLLAR are unioned and aggregated. Daily totals are calculated based on UTC day boundaries, and a zero-fill strategy is applied to ensure data continuity across all supported chains.

*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

Exchanges (DEX)

Collators aggregate parachain transactions block candidates and producing state transition proofs for validators based on those blocks.

Hydration is a Polkadot parachain specialized in trading, lending, and stablecoin issuance.

HDX holders own and govern the protocol. Hydration’s investors include KR1 plc, Hypersphere, etc.

Hydration DEX

Fees

Fees

Chain breakdown