# LayerZero V2 Cost of revenue Methodology

## 1. Overview

Cost of revenue for LayerZero V2 is set to zero. No portion of user fees is retained by the protocol, as 100% of collected fees is distributed directly to infrastructure providers, including Decentralized Verifier Network (DVN) operators and message executors. These payments are classified as supply-side fees rather than cost of revenue because the protocol has not activated a fee switch to capture protocol-level revenue from which expenses would be paid.

## 2. Data sources

- **None**: This metric is set to a constant value and does not consume blockchain events

## 3. Step-by-step calculation

### Component A: Constant value assignment

- **Purpose**: Establish the cost of revenue for the protocol
- **Logic**: A constant value of zero is assigned to the metric across all supported chains. This reflects the architectural design of LayerZero V2, where user payments for message verification and execution are passed through to external infrastructure providers. Since no protocol-level revenue is collected, no expenses are recorded for the outsourcing of these core services.
- **Key fields**: `cost_of_revenue` (hardcoded to 0)

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

Expenses paid to third parties to deliver core service output.

Cost of revenue

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 v2

Cost of revenue

Cost of revenue

Chain breakdown