Liquidity providers deposit funds into Pangolin and receive trading fees from traders (supply-side fees).

Pangolin is a non-custodial exchange protocol built on Avalanche (originally a fork of Uniswap). Pangolin was founded by an anonymous team and launched in 2020.

PNG tokenholders own and govern the protocol. They currently take a cut of the total trading fees paid by traders (revenue).

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Pangolin

# Pangolin Supply-side fees Methodology

## 1. Overview

Pangolin supply-side fees represent the portion of trading fees that flows to liquidity providers on the Pangolin decentralized exchange. This metric calculates 5/6 (approximately 83.3%) of total trading fees generated from swaps on Pangolin v1 on the Avalanche blockchain. The remaining 1/6 represents protocol fees. The calculation aggregates daily trading volumes, applies the 0.3% fee tier, and allocates the majority share to liquidity providers.

## 2. Data sources

The calculation relies on several raw data sources from the Avalanche blockchain and external systems:

- **Pangolin Factory events**: Parsed `PairCreated` events from the Pangolin v1 Factory contract on Avalanche that establish trading pairs and their fee structures
- **Pangolin Pair events**: Parsed `Swap` events from individual Pangolin v1 Pair contracts on Avalanche containing trade execution data
- **Avalanche transaction data**: Transaction records from Avalanche blockchain providing user addresses and transaction context
- **Token metadata**: Token contract information including symbols and decimal places for proper amount calculations
- **End-of-day price feeds**: Daily USD price data for tokens to enable volume conversion and manipulation filtering

## 3. Step-by-step calculation

### Component A: Trading pair identification
- **Purpose**: Establish all active Pangolin trading pairs and their fee structures
- **Logic**: Extract trading pair creation events from the Pangolin Factory contract on Avalanche. Each `PairCreated` event contains the pair contract address, `token0` address, and `token1` address. All Pangolin v1 pairs have a fixed fee tier of 0.3% (3000 basis points). Join with token metadata to obtain decimal places and symbols for both tokens in each pair.
- **Key fields**: `account_address` (pair contract), `token0_address`, `token1_address`, `fee_tier` (0.3%), `token0_decimals`, `token1_decimals`, `account_name` (token symbol combination)

### Component B: Trade event processing  
- **Purpose**: Extract individual swap transactions and calculate token amount changes
- **Logic**: Process `Swap` events from Pangolin Pair contracts on Avalanche. Each swap event contains `amount0In`, `amount0Out`, `amount1In`, and `amount1Out` fields. Calculate the net change for each token by subtracting outbound amounts from inbound amounts. Join with Avalanche transaction data to link swaps to user addresses. Filter to include only trades from February 8, 2021 onward when Pangolin launched.
- **Key fields**: `block_timestamp`, `transaction_hash`, `log_index`, `account_address` (pair contract), `user_address`, `token0_amount` (net change), `token1_amount` (net change)

### Component C: Daily volume aggregation
- **Purpose**: Aggregate trading volumes by day and convert to USD values
- **Logic**: Group swap events by day, pair contract, and transaction details. Apply decimal correction by dividing token amounts by 10 raised to the power of token decimals. Take absolute values of token amounts to get trade volumes. Join with end-of-day price feeds to convert token amounts to USD values for both tokens in each pair. Apply anti-manipulation filtering by taking the lesser USD value between `token0` and `token1` amounts for each trade, ensuring volume calculations aren't inflated by price anomalies.
- **Key fields**: `timestamp` (daily), `trading_volume` (USD value), `fee_tier`, `chain` (avalanche)

### Component D: Fee calculation
- **Purpose**: Calculate total fees generated from trading activity
- **Logic**: Aggregate daily trading volumes across all Pangolin pairs on Avalanche. Multiply the total trading volume by the fee tier (0.3%) to determine total fees collected. Group by day, chain, market sector, business segment, and product identifiers.
- **Key fields**: `trading_volume`, `fees` (volume × 0.3%), `timestamp`, `chain_id`

### Final aggregation
- **Combining components**: Take the total daily fees calculated in Component D and apply the supply-side allocation ratio
- **Supply-side allocation**: Multiply total fees by 5/6 (approximately 83.3%) to determine the portion allocated to liquidity providers, with the remaining 1/6 representing protocol fees
- **Currency conversion**: All volumes and fees are already converted to USD using end-of-day price feeds during the volume aggregation step
- **Time aggregation**: Data is aggregated at daily boundaries using timestamp truncation to day level
- **Final calculation**: Supply-side fees = Total trading volume × 0.3% fee tier × 5/6 supply-side share, aggregated daily across all Pangolin v1 pairs on Avalanche

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

Portion of fees distributed to service providers or supply-side participants.

PangolinPNG

Supply-side fees

Supply-side fees

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