KAP Games collects publishing and distribution fees from games on its platform and services, as well as a fee from in-app purchases and microtransactions inside of its games.

KAP Games is a web3 gaming distributor, publisher & studio, specializing in browser and mobile-native experiences. KAP Games was founded by the Kapital Foundation and launched in 2022.

KAP tokenholders own and govern the protocol. They currently take all of the total publishing and distribution fees (revenue). Kapital DAO's investors include Polygon Ventures, Wintermute Ventures, Yield Guild Games, etc.

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KAP Games

# KAP Games Earnings Methodology

## 1. Overview

Earnings represents the net profitability of Kapital DAO's gaming business operations, calculated as total revenue minus total expenses. This metric provides insights into the DAO's financial performance by measuring the difference between fees collected from gaming organizations and token incentives distributed as rewards. The calculation uses a straightforward profit formula where daily revenue from various fee streams is reduced by daily expenses from token reward distributions.

## 2. Data sources

The earnings calculation relies on several blockchain and external data sources:
- **Token transfer events**: Parsed Ethereum `Transfer` events showing ERC20 token movements to and from Kapital DAO's multisig address
- **Native ETH transaction flows**: Ethereum native ETH transaction records tracking ETH transfers to the multisig address
- **Smart contract events**: Kapital DAO RewardsLocker contract events, specifically `RewardsLocker_CollectRewards_event` logs that track reward distributions
- **End-of-day token price feeds**: Daily USD pricing data for token value conversion
- **Token metadata**: Token contract information including decimal precision and symbols for proper amount calculations

## 3. Step-by-step calculation

### Component A: Revenue calculation
- **Purpose**: Captures all fees paid to Kapital DAO by gaming organizations
- **Logic**: Identifies all token transfers and native ETH flows directed to Kapital DAO's multisig address (`0xfa3df5c014bbd5a6a6d1047b82331917c3f9bb9d`). For token transfers, the system filters parsed `Transfer` events where the `to_address` matches the multisig. For native ETH, it captures positive value flows from Ethereum native transaction data where the `account_address` matches the multisig. All transactions are aggregated daily by truncating `block_timestamp` to day boundaries. Each transaction is categorized under the gaming business line and game business segment with version v1.
- **Key fields**: `block_timestamp` for timing, `transaction_hash` and `log_index` for event identification, `token_address` for asset type, `value` or `amount` for transfer quantities, and `to_address` or `account_address` for recipient verification

### Component B: Expenses calculation
- **Purpose**: Tracks token incentives distributed as rewards to participants
- **Logic**: Captures KAP token reward distributions by joining `RewardsLocker_CollectRewards_event` logs with corresponding token transfer events. The system identifies reward collection events and matches them with KAP token transfers (`0x9625ce7753ace1fa1865a47aae2c5c2ce4418569`) where the `beneficiary` from the event matches the `to_address` in the transfer, and the transfer destination is the multisig address. This ensures only legitimate reward distributions are counted. Amounts are aggregated daily using timestamp truncation.
- **Key fields**: `beneficiary` from reward events, `transaction_hash` for event matching, `token_address` for KAP token identification, `value` for reward amounts, and `block_timestamp` for daily aggregation

### Component C: Token incentives processing
- **Purpose**: Converts raw token incentive data into standardized expense metrics
- **Logic**: Takes the KAP token reward data and applies decimal corrections and USD conversion. The system adjusts token amounts based on the token's decimal precision and converts values to USD using end-of-day price feeds. Data is aggregated by day, chain, product, and other business dimensions.
- **Key fields**: `token_incentives` representing the USD value of distributed rewards, `timestamp` for daily boundaries, `chain_id` for blockchain identification

### Final aggregation
- **Combining components**: Revenue data from fee collections and expense data from token incentives are processed through separate standardization pipelines that ensure consistent schema and fill missing dates with zeros. The earnings calculation then subtracts the daily expense amounts from daily revenue amounts for each matching timestamp and dimensional combination.
- **Currency conversion**: All token amounts are converted to USD using end-of-day price feeds, with proper decimal adjustment based on each token's precision. This ensures consistent valuation across different assets.
- **Time aggregation**: All data is aggregated to daily boundaries by truncating block timestamps to day level. Missing days in the time series are filled with zero values to maintain continuity.
- **Final calculation**: Daily earnings equals daily revenue minus daily expenses, where revenue represents fees collected from gaming organizations and expenses represent KAP token rewards distributed. The result provides net profit/loss for each day of operations.

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

Net profit (also profits, net income, profitability) — revenue remaining after subtracting expenses.

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