Video miners (a.k.a orchestrators) perform transcoding work through the protocol and receive fees from users (a.k.a broadcasters) who assign tasks to them in return for an agreed upon fee (supply-side fees).

Livepeer is a video infrastructure protocol built on Ethereum. Livepeer was founded by Doug Petkanics & Eric Tangand and launched in 2017.

LPT holders own and govern the protocol. They do not currently take a cut of the total fees paid by broadcasters (revenue). Livepeer’s investors include Northzone, Digital Currency Group, Collaborative Fund, etc.

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Livepeer

# Livepeer Earnings Methodology

## 1. Overview

The Livepeer earnings metric measures the protocol's daily net earnings by calculating the difference between revenue and expenses. In this implementation, earnings equals negative expenses since revenue is set to zero, making this effectively a measure of the protocol's daily token incentive costs. The metric tracks LPT token rewards paid to transcoding validators across Ethereum and Arbitrum networks, converted to USD values for consistent reporting.

## 2. Data sources

The calculation relies on the following raw data sources:
- **Livepeer protocol events**: Parsed `BondingManager_Reward` events from Ethereum and Arbitrum that record LPT token incentive payments to transcoding validators
- **Transcoding fee events**: Parsed `TicketBroker_WinningTicketRedeemed` events from Ethereum and Arbitrum that track transcoding fee payments (used for data structure but not revenue calculation)
- **End-of-day price feeds**: Daily closing prices for LPT tokens and ETH/WETH to enable USD conversion
- **Token metadata**: Decimal precision and address mapping data for accurate token amount calculations across different chains

## 3. Step-by-step calculation

### Component A: Token incentive payments
- **Purpose**: Captures LPT token rewards paid to transcoding validators as protocol expenses
- **Logic**: Extracts `BondingManager_Reward` events from both Ethereum and Arbitrum networks, filtering out removed transactions. Each event contains the validator `address`, reward `amount` in LPT tokens, and transaction metadata. The data is standardized across chains with proper token address mapping (LPT token addresses differ between Ethereum and Arbitrum). Events are aggregated daily by validator address and chain.
- **Key fields**: Validator `address`, LPT reward `amount`, `block_timestamp`, `transaction_hash`, and chain-specific `token_address`

### Component B: Transcoding fees structure  
- **Purpose**: Provides the data structure and chain coverage for the earnings calculation but contributes zero to actual revenue
- **Logic**: Extracts `TicketBroker_WinningTicketRedeemed` events from Ethereum and Arbitrum that contain transcoding fee payments. The `faceValue` field represents fees paid, but the revenue component is hardcoded to zero in the final calculation. This component ensures the earnings metric covers the same time periods and chains as the fee data.
- **Key fields**: Fee `faceValue`, validator `address`, `block_timestamp`, and chain-specific token addresses (WETH on Ethereum, WETH on Arbitrum)

### Component C: Revenue calculation
- **Purpose**: Defines the revenue component of the earnings formula
- **Logic**: Takes the fee data structure from transcoding fees but sets all revenue values to zero. This creates a consistent daily time series with proper chain and product coverage while ensuring revenue contributes nothing to the final earnings calculation.
- **Key fields**: `timestamp`, `chain_id`, `product_id`, and `revenue` (always 0)

### Component D: Expenses calculation  
- **Purpose**: Converts LPT incentive payments into USD-denominated expenses
- **Logic**: Takes the daily aggregated LPT reward amounts from Component A and applies decimal precision corrections based on the LPT token's 18-decimal structure. Converts LPT amounts to USD using end-of-day price feeds, matching each day's rewards with that day's closing LPT price. Aggregates expenses by day and chain, applying zero-fill logic for dates with no incentive payments.
- **Key fields**: Daily `token_incentives` amounts converted to `expenses` in USD

### Final aggregation
- **Combining components**: The earnings calculation uses the standard formula: earnings = revenue - expenses. Revenue is always zero, and expenses equal the daily USD value of LPT incentive payments. The calculation joins revenue and expense data by timestamp, chain, and product dimensions.
- **Currency conversion**: All LPT token amounts are converted to USD using end-of-day closing prices on the date of the incentive payment. Decimal precision is corrected to ensure accurate conversion from the LPT token's 18-decimal native format.
- **Time aggregation**: Data is aggregated to daily boundaries using timestamp truncation to day level. Missing dates are filled with zero values to ensure continuous time series coverage.
- **Final calculation**: Daily earnings equals zero revenue minus daily LPT incentive expenses, resulting in negative earnings that represent the protocol's daily cost of validator incentives. Chain availability filters ensure data quality across different blockchain networks.

*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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