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

Polygon is a smart contract platform for decentralized applications & interoperability platform for blockchains. Polygon was founded by Jaynti Kanani, Sandeep Nailwal & Anurag Arjun and launched in 2017.

MATIC holders own and govern the protocol. They currently take a cut of the total transaction fees paid by users (revenue). Polygon’s investors include Coinbase Ventures, ZBS Capital, MiH Ventures, etc.

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Polygon

# Polygon Average revenue per user (ARPU) Methodology

## 1. Overview

Average Revenue Per User (ARPU) measures the average daily revenue generated per active user on the Polygon network. This metric is calculated by dividing daily protocol revenue by the number of daily active users. For Polygon, revenue consists of base fees that are burned (removed from circulation) rather than collected by validators, representing the protocol's deflationary mechanism. ARPU helps assess the economic efficiency and user monetization of the Polygon blockchain.

## 2. Data sources

The calculation relies on these core data sources:
- **Polygon transaction records**: Complete transaction data including sender addresses, gas usage, effective gas prices, and timestamps
- **Polygon block data**: Block-level information including base fees per gas and gas usage totals
- **End-of-day price feeds**: Token prices for WPOL (Wrapped Polygon) used for USD conversion
- **Token metadata**: Decimal precision data for proper unit conversion

## 3. Step-by-step calculation

### Component A: Daily active user calculation
- **Purpose**: Count unique users transacting on Polygon each day
- **Logic**: Extract all transaction sender addresses from Polygon transaction records. Group transactions by day using timestamp truncation. Count distinct sender addresses per day using HyperLogLog approximation for scalable computation. Users are defined as any address that initiates at least one transaction on a given day, classified as 'Transaction sender' user type.
- **Key fields**: `from_address` for user identification, `block_timestamp` for daily grouping, `user_dau` for the final count

### Component B: Daily revenue calculation  
- **Purpose**: Calculate daily protocol revenue from burned base fees
- **Logic**: Extract gas usage and block information from Polygon transactions and blocks. Join transaction data with corresponding block data using block numbers. Calculate burned fees by multiplying transaction `gas_used` by block `base_fee_per_gas`. Base fees are adjusted for decimal precision by dividing by 10^18. Aggregate total burned fees by day. Convert daily totals to USD using end-of-day WPOL token prices.
- **Key fields**: `gas_used` from transactions, `base_fee_per_gas` from blocks, `base_fee_amount` for daily totals, `revenue` for USD-converted amounts

### Final aggregation
- **Combining components**: Daily revenue totals are divided by daily active user counts for the same date to produce daily ARPU values
- **Currency conversion**: All revenue is converted to USD using end-of-day WPOL token price feeds, ensuring consistent currency representation
- **Time aggregation**: Calculations use daily boundaries defined by timestamp truncation to the day level, ensuring alignment between revenue and user metrics
- **Final calculation**: ARPU equals daily revenue in USD divided by daily active users, with missing days filled with zero values to maintain continuous time series data

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

PolygonPOL

Average revenue per user (ARPU)

Average revenue per user (ARPU)

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