# Jupiter Lend Active loans Methodology

## 1. Overview

Active loans measures the total value of user deposits currently lent out to borrowers through Jupiter Lend. This metric tracks the portion of liquidity that generates revenue for the protocol, as borrowers are required to pay interest on these outstanding balances. Active loans are tracked at the asset level, accounting for both principal borrowed and compound interest accrued over time.

## 2. Data sources

- **Blockchain events**: `Operate`, `UpdateRateDataV1`, `UpdateRateDataV2`, and `UpdateTokenConfig` instructions from the `Liquidity` program on Solana
- **External data**: End-of-day price feeds and asset metadata

## 3. Step-by-step calculation

### Component A: Operational activity extraction

- **Purpose**: Capture the raw borrowing and supply changes that affect loan balances
- **Logic**: `Operate` instructions from the `Liquidity` program are parsed to extract `borrow_amount` and `supply_amount` for each asset. These instructions represent the primary interactions where users increase or decrease their debt positions and deposited collateral.
- **Key fields**: `borrow_amount`, `supply_amount`, `mint` (token identification)

### Component B: Interest rate parameter tracking

- **Purpose**: Maintain a historical record of the interest rate curves applied to active loans
- **Logic**: `UpdateRateDataV1` and `UpdateRateDataV2` instructions are parsed to capture interest rate parameters, including base rates, utilization kinks, and maximum rates. This includes support for both single-kink (V1) and double-kink (V2) interest rate models. These parameters are joined to the operational event stream to ensure the correct rate logic is applied based on the timestamp of each transaction.
- **Key fields**: `kink`, `rate_at_utilization_kink`, `rate_at_utilization_max`, `rate_at_utilization_zero`

### Component C: Compound interest accrual and running balance calculation

- **Purpose**: Calculate the continuous growth of loan balances due to interest
- **Logic**: All operational and rate update events are ordered chronologically by account and asset. For every interval between instructions, utilization is calculated as the ratio of borrowed assets to supplied assets. The specific interest rate (in basis points) is determined by applying the active rate curve to the utilization level. Compound interest is accrued for the time elapsed between events using a 365-day annualization basis. The final loan balance for each event is calculated as the sum of the previous balance, the newly accrued interest, and any new borrow or repayment activity.
- **Key fields**: `active_loan_balance`, `interest_accrued_this_period`, `rate_bps`

### Component D: Daily valuation and USD conversion

- **Purpose**: Normalize loan balances to USD for daily reporting
- **Logic**: The final `active_loan_balance` recorded for each asset at the end of every UTC day is captured. These balances are normalized by the decimal precision of the respective assets. The resulting quantities are multiplied by end-of-day price feeds to determine the USD value of active loans.
- **Key fields**: `active_loans` (USD), `price_usd`, `decimals`

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

Value of loans currently outstanding to borrowers.

Active loans

Lending

Jupiter aggregates liquidity from multiple non-custodial exchanges. Integrators set custom fees. Liquidity providers deposits funds into the perpetual exchange. Both receive fees from traders (supply-side fees).

Jupiter is a non-custodial DEX aggregator and exchange for perpetual contracts built on Solana. Jupiter was founded by an pseudonymous founder meow and launched in 2021.

JUP token holders own and govern the protocol. They currently take a cut of the total perpetual and integrator trading fees paid by traders (revenue). Jupiter's investors include White Hilt Capital, etc.
