Users complete Quests, Races, or other experiences to earn rewards.

Layer3 is a platform that allows anyone to discover web3 through interactive experiences.

L3 tokenholders own and govern the protocol. L3's investors include ParaFi Capital, Greenfield Capital, etc.

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Layer3

# Layer3 Earnings Methodology

## 1. Overview

Earnings measures the net value retained by Layer3 after subtracting all reward payout expenses from revenue. This metric reflects the profitability of Layer3's quest and infrastructure platform across multiple blockchain networks. Revenue is generated from several fee sources including cube mints, B2B services, bridge operations, and referral programs, while expenses are comprised of reward payouts to quest participants.

## 2. Data sources

- **Blockchain events**: ERC-20 `Transfer` events, `EscrowRegistered` events from `Factory` contracts, and `CubeClaim` events from `Cube` contracts, plus native gas fees from transaction records, covering Ethereum, Arbitrum, Base, Polygon, and 7 other chains
- **External data**: End-of-day price feeds for assets and native gas tokens

## 3. Step-by-step calculation

### Component A: Revenue calculation

- **Purpose**: Aggregates all revenue streams from Layer3's various products and services
- **Logic**: Five distinct revenue sources are combined to determine total fees. First, cube mint transaction fees are calculated by identifying transactions containing `CubeClaim` events from `Cube` contracts and extracting the associated gas fees paid in native tokens. Second, B2B escrow revenue is identified from token transfers to Layer3 primary wallets and registered escrow contracts, excluding transfers from internal escrow addresses. Third, cube revenue in L3 tokens is tracked through transfers of the L3 asset to designated recipient addresses. Fourth, bridge fees and referral revenue are captured from token transfers to specific bridge and referral wallet addresses. All transfers are filtered by recipient address and normalized by decimal precision.
- **Key fields**: `block_timestamp` for daily aggregation, `token_address` and `amount` for revenue calculation, `chain_id` for chain-specific tracking

### Component B: Expenses calculation
- **Purpose**: Captures Layer3's costs from reward payouts to quest participants
- **Logic**: Reward payouts are identified as token transfers from registered escrow contracts to user addresses. Escrow contracts are verified through `EscrowRegistered` events emitted by `Factory` contracts across all supported chains. These transfers represent reward distributions for completed quests or platform activities on the Layer3 platform. Payout values are normalized using token decimals and aggregated daily.
- **Key fields**: `from_address` matching registered escrow contracts, `amount` for payout values, `token_address` for token identification

### Component C: USD conversion and final aggregation

- **Purpose**: Standardizes all revenue and expense amounts in USD for net profit calculation
- **Logic**: All monetary values are standardized to USD for cross-chain comparison. Token amounts are normalized by decimal precision and multiplied by end-of-day price feeds. Daily earnings are calculated as the net value remaining after subtracting total reward payout expenses from the sum of all revenue streams, including cube fees, B2B revenue, bridge fees, and referral revenue. Gap-filling is applied to ensure a continuous time series data.

*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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Earnings

Earnings

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