# LayerZero V1 Fees Methodology

## 1. Overview

Fees measures the total value paid by users to execute cross-chain messages and asset transfers via LayerZero V1. This metric encompasses payments made to decentralized verifier networks (DVNs), message executors, and liquidity providers within the Stargate V1 protocol. These fees are primarily paid in the source chain's native gas asset and are collected to ensure the secure verification and delivery of cross-chain infrastructure calls.

## 2. Data sources

- **Blockchain events**: `DVNFeePaid` and `ExecutorFeePaid` events from `SendUln301` contracts, `send` function calls from `EndpointV1` contracts, and `Swap` events from `Pool` contracts, covering Ethereum, Arbitrum, Base, Polygon, and 17 other chains
- **External data**: End-of-day price feeds for native gas assets and supported bridge assets

## 3. Step-by-step calculation

### Component A: DVN fee extraction

- **Purpose**: Captures fees paid to Decentralized Verifier Networks for message validation services
- **Logic**: `DVNFeePaid` events are parsed from `SendUln301` contracts. Fee amounts are calculated by summing all elements within the `fees` array, which represents the individual fees paid to each Decentralized Verifier Network (DVN) involved in message validation
- **Key fields**: `fees` (array of payment amounts)

### Component B: Executor fee extraction

- **Purpose**: Captures fees paid to message executors for the physical delivery of messages to the destination chain
- **Logic**: `ExecutorFeePaid` events are parsed from `SendUln301` contracts. The fee amount is extracted directly from the `fee` field for each successful message transmission
- **Key fields**: `fee` (executor payment amount)

### Component C: Legacy messaging fee estimation

- **Purpose**: Estimates fees for transactions occurring before the deployment of the `SendUln301` and `SendUln302` contracts
- **Logic**: `send` function calls are parsed from `EndpointV1` contracts for transactions occurring on or before February 5, 2024. The estimated fee is calculated by taking the transaction's native `value` and subtracting the `airdrop_native_amount`. The airdrop amount is decoded from the `adapterParams` field based on the hex prefix version. If the adapter version is 2, the portion of the message value intended as an airdrop to the destination chain is identified and excluded from the messaging fee calculation
- **Key fields**: `value` (total native amount sent), `adapterParams` (encoded execution parameters)

### Component D: Stargate V1 trade fee aggregation

- **Purpose**: Captures fees generated by asset swaps and bridging within the Stargate V1 protocol
- **Logic**: `Swap` events are parsed from Stargate V1 `Pool` contracts. The total fee per swap is calculated as the sum of the liquidity provider fee (`lpFee`) and the protocol fee (`protocolFee`). These values are identified using pool-specific configurations to ensure correct asset identification and decimal normalization
- **Key fields**: `lpFee`, `protocolFee`, `amountSD` (shared decimal amount)

### Component E: Normalization and USD conversion

- **Purpose**: Normalizes all fee components to USD for cross-chain and cross-asset aggregation
- **Logic**: All extracted fee amounts are normalized by the respective asset's decimal precision. Messaging fees (DVN, Executor, and Legacy) are typically denominated in the source chain's native gas asset. Stargate V1 fees are denominated in the specific asset being bridged. Normalized amounts are multiplied by end-of-day price feeds for each asset. Daily totals are aggregated across all chains using UTC day boundaries

*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

Interoperability

LayerZero uses a decentralized network of Validator Nodes to facilitate secure and fast communication between different blockchains.

LayerZero allows users to send and receive messages between different blockchains, and to bridge tokens between different blockchains.

LayerZero is a cross-chain interoperability protocol that enables secure and fast communication between different blockchains.

LayerZero v1

Fees

Fees

Chain breakdown