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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Blockchains (L1)

Polygon

# Polygon Token incentives Methodology

## 1. Overview

This metric measures the daily USD value of POL token incentives distributed by the Polygon network. Token incentives represent rewards paid to validators and other network participants as part of Polygon's consensus mechanism. The calculation extracts reward data from Polygon's RootChain contract events on Ethereum, converts the POL token amounts to USD, and aggregates them on a daily basis.

## 2. Data sources

The metric relies on the following raw data sources:
- **Ethereum blockchain events**: Parsed `NewHeaderBlock` events from Polygon's RootChain contract on Ethereum, which contain reward amounts distributed to network participants
- **External price data**: End-of-day price feeds for POL token to enable USD conversion
- **Token metadata**: POL token information including decimal precision for accurate amount calculations

## 3. Step-by-step calculation

### Component A: Reward event extraction
- **Purpose**: Extracts raw POL token reward amounts from Ethereum blockchain events
- **Logic**: Filters Ethereum event logs for `NewHeaderBlock` events from Polygon's RootChain contract. Each event contains a `reward` field representing POL tokens distributed. The component extracts key event metadata including block timestamp, transaction hash, and log index for deduplication. All rewards are attributed to the hardcoded POL token contract address `0x7d1afa7b718fb893db30a3abc0cfc608aacfebb0` and tagged with chain as 'ethereum'
- **Key fields**: `reward` amounts converted to bignumeric precision, `block_timestamp` for daily aggregation, `token_address` set to POL contract address

### Component B: USD conversion and standardization  
- **Purpose**: Converts POL token amounts to USD values and applies metric standardization
- **Logic**: Takes the extracted reward amounts and applies decimal correction based on POL token's precision settings, then converts to USD using end-of-day price feeds. Timestamps are truncated to daily boundaries for aggregation. The data is enriched with standard metric dimensions including chain_id, market_sector_id ('blockchains_l1'), business_segment_id ('blockchain'), with product_id set to null
- **Key fields**: `token_incentives` as the corrected and USD-converted amounts, `timestamp` truncated to day boundaries, standardized dimension fields

### Final aggregation
- **Combining components**: The USD-converted reward amounts flow directly from component B without additional joining
- **Currency conversion**: POL token amounts are converted to USD using end-of-day price feeds, with automatic decimal correction applied based on token metadata
- **Time aggregation**: All reward events within each day are aggregated at daily timestamp boundaries
- **Final calculation**: The final `token_incentives` value represents the total USD value of POL tokens distributed as network incentives per day, with zero-fill applied for days with no reward events and chain availability filtering to ensure data quality standards

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

Value of native tokens distributed as incentives.

PolygonPOL

Token incentives

Token incentives

Competitive landscape

Chain breakdown