# Polkadot Collectives Fees Methodology

## 1. Overview

Fees measures the total value paid by users to interact with Polkadot Collectives. This metric includes both the base transaction fees required for execution and any optional tips paid by users to prioritize their transactions. These fees represent the total economic value generated by the use of Polkadot Collectives and are denominated in the DOT asset.

## 2. Data sources

- **Blockchain events**: `TransactionFeePaid` events from Polkadot Collectives, covering the Polkadot network
- **External data**: End-of-day price feeds for the DOT asset

## 3. Step-by-step calculation

### Component A: Transaction fee and tip extraction

- **Purpose**: Capture the raw base fees and tips paid for transaction execution on Polkadot Collectives.
- **Logic**: `TransactionFeePaid` events are parsed from Polkadot Collectives. The transaction fee amount is extracted from the first data index of the event, and the tip amount is extracted from the second data index. These components are captured for every successful transaction to ensure a complete record of user payments.
- **Key fields**: `event_data`, `block_timestamp`, `extrinsic_hash`

### Component B: USD normalization and aggregation

- **Purpose**: Convert native asset values into a standardized USD valuation for reporting.
- **Logic**: Extracted fee and tip amounts are normalized by decimal precision. The total fee for each transaction is calculated by summing the normalized base fee and the tip. These totals are then multiplied by the end-of-day USD price of the DOT asset. Daily totals are aggregated by summing the USD values across all transactions within UTC day boundaries.
- **Key fields**: `amount`, `tip`, `price_usd`, `block_timestamp`

*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

Blockchains (L2)

Network participants process transactions and receive fees from users (supply-side fees).

Polkadot is a security & interoperability platform for blockchains and applications. Polkadot was founded by Gavin Wood and launched in 2020.

DOT holders own and govern the protocol. They currently take a cut of the total transaction fees paid by users (revenue). Polkadot’s investors include Polychain, IOSG Ventures, Hashkey, etc.

Polkadot Collectives

Fees

Fees

Chain breakdown