# vKAT Fees Methodology

## 1. Overview

Fees measures the total economic value generated by the vKAT product, representing early-exit penalties and third-party voting incentives. These fees are generated when locked assets are withdrawn early by users or when incentives are distributed by external protocols to influence governance decisions. Early-exit fees are paid in the native governance asset and retained by the DAO-controlled protocol treasury. Voting incentives are distributed via Merkl campaigns to reward vKAT lockers.

## 2. Data sources

- **Blockchain events**: `Exit` events from `DynamicExitQueue` contracts and `NewCampaign` events from `DistributionCreator` contracts, covering Katana Chain
- **External data**: End-of-day price feeds for reward assets and the native governance asset, and asset metadata for decimal normalization

## 3. Step-by-step calculation

### Component A: vKAT early-exit fee extraction

- **Purpose**: Capture fees charged to users who withdraw locked vKAT before maturity
- **Logic**: `Exit` events from `DynamicExitQueue` contracts are parsed. The `fee` field, representing the early-exit penalty paid in the native governance asset, is extracted and normalized by decimal precision. These transactions are aggregated daily by asset address.
- **Key fields**: `fee` (fee amount), `block_timestamp` (timing)

### Component B: vKAT voting incentives extraction

- **Purpose**: Capture third-party voting incentives distributed to vKAT lockers
- **Logic**: `NewCampaign` events from `DistributionCreator` contracts are parsed. Campaigns are filtered to include only those with a `campaignType` of 102, which corresponds to vKAT voting incentives. To prevent double-counting of protocol-funded rewards (such as Vault Bridge yield, AUSD yield, or KAT emissions), campaigns created by the Katana DAO or its yield Safe addresses are excluded. The remaining reward amounts are aggregated daily by reward asset address.
- **Key fields**: `amount` (reward amount), `campaignType` (campaign identifier), `creator` (campaign creator address), `rewardToken` (reward asset address)

### Component C: USD conversion and aggregation

- **Purpose**: Normalize all fee components to USD and aggregate them
- **Logic**: Daily exit fees and voting incentives are combined. For voting incentives, raw asset amounts are normalized by decimal precision using asset metadata. Both exit fees and voting incentives are multiplied by end-of-day asset prices to convert the values to USD. The final metric is aggregated daily using UTC day boundaries.
- **Key fields**: `timestamp` (daily boundary), `fees` (USD-denominated fee value)

*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

Blockchains (L2)

The network uses pessimistic proofs via the AgglayerGateway for settlement on Ethereum, with vault bridges for cross-chain asset transfers.

Katana Network provides a scalable execution environment connected to Ethereum through the Agglayer interoperability layer.

vKAT

Fees

Fees

Chain breakdown