Liquidity providers deposit funds into Notional and receive trading fees from borrowers & lenders (supply-side fees).

Notional is a non-custodial fixed-rate, fixed-term lending protocol built on Ethereum. Notional was founded by Jeff Wu & Teddy Woodward and launched in 2020.

NOTE holders own and govern the protocol. They currently take a cut of the total trading fees paid by borrowers & lenders and all of the COMP incentives from funds deposited to Compound (revenue). Notional’s investors include Coinbase Ventures, Nascent Ventures, 1Confirmation, etc.

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Lending

Notional Finance

# Notional Finance Token incentives Methodology

## 1. Overview

Token incentives measures the total USD value of NOTE tokens distributed as rewards to users on Notional Finance per day. This metric captures the protocol's spending on user incentives through token distributions from the dedicated reward contract. The calculation tracks NOTE token transfers from Notional's reward contract to recipients, converts the amounts to USD, and aggregates them by day to show daily incentive spending.

## 2. Data sources

The calculation uses these raw data sources:
- **Blockchain events**: Parsed Ethereum `Transfer` events for the NOTE token contract
- **Token metadata**: NOTE token contract address and decimal configuration
- **External data**: End-of-day price feeds from CoinGecko for NOTE token USD conversion
- **Transaction data**: Ethereum block timestamps for daily boundary determination

## 3. Step-by-step calculation

### Component A: Note token reward extraction
- **Purpose**: Identifies and extracts NOTE token distributions from the reward contract
- **Logic**: Filters Ethereum `Transfer` events to capture only transfers where the sender (`from_address`) is the specific Notional reward contract address `0x1344a36a1b56144c3bc62e7757377d288fde0369` and the token being transferred is the NOTE token at address `0xcfeaead4947f0705a14ec42ac3d44129e1ef3ed5`. This ensures only genuine reward distributions are captured, not user-to-user transfers or other token movements. Each transfer represents an incentive payment to a user.
- **Key fields**: Captures the `value` field representing raw token amounts, along with `block_timestamp`, `transaction_hash`, `log_index`, and `token_address` for tracking and deduplication purposes

### Component B: Daily aggregation and decimal correction
- **Purpose**: Aggregates reward amounts by day and applies proper decimal normalization
- **Logic**: Groups the extracted transfers by daily timestamp boundaries using timestamp truncation to the day level. Applies decimal correction by dividing raw token amounts by 1e8 to convert from the contract's internal representation to actual NOTE token units. Assigns business classification metadata including 'Lending' as the business line, 'lending' for market sector and segment identifiers, and 'v1' as the version.
- **Key fields**: Creates daily aggregated `token_incentives` amounts and `daily_timestamp` boundaries, along with protocol metadata fields

### Component C: USD conversion
- **Purpose**: Converts NOTE token amounts to USD values using market prices
- **Logic**: Applies CoinGecko price conversion using the 'notional-finance' identifier to convert daily token incentive amounts to USD equivalents. Uses end-of-day price feeds to ensure consistent valuation timing with the daily aggregation boundaries.
- **Key fields**: Produces USD-denominated incentive values while maintaining all original token amount and metadata fields

### Final aggregation
- **Combining components**: The components flow sequentially - reward extraction feeds into daily aggregation, which feeds into USD conversion
- **Currency conversion**: Uses CoinGecko end-of-day prices for the NOTE token to convert incentive amounts from token units to USD values
- **Time aggregation**: Daily boundaries are established using timestamp truncation to day level, ensuring all transfers within a calendar day are grouped together
- **Final calculation**: The final metric represents the total USD value of NOTE tokens distributed as incentives per day, with gap-filling logic that inserts zero values for days with no reward distributions to maintain complete time series data

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

Value of native tokens distributed as incentives.

Notional FinanceNOTE

Token incentives

Token incentives

Competitive landscape

Chain breakdown