# Polymarket International Supply-side fees Methodology

## 1. Overview

Supply-side fees measures the share of transaction fees generated on Polymarket International that is distributed to service providers and market participants. The incentives distributed to maintain liquidity and facilitate trading activity on the platform are captured by this metric. For the historical AMM-based model, supply-side fees are represented by the total fees generated by the automated market makers. For the order book-based model, supply-side fees are composed of taker rebates distributed to market participants by order book distributors.

## 2. Data sources

- **Blockchain events**: `FPMMBuy` and `FPMMSell` events from `FixedProductMarketMaker` contracts, `OrderFilled` events from `Exchange` and `NegRiskCtfExchange` contracts, and ERC-20 `Transfer` events, covering Polygon
- **External data**: End-of-day price feeds for USDC and pUSD assets

## 3. Step-by-step calculation

### Component A: AMM and V1 orderbook fee extraction

- **Purpose**: Capture historical transaction fees from the AMM and V1 order book models
- **Logic**: AMM trades are captured by parsing `FPMMBuy` and `FPMMSell` events from `FixedProductMarketMaker` contracts to extract the `feeAmount` field. For V1 order book trades, ERC-20 `Transfer` events of USDC from designated fee source contracts to fee recipient addresses are tracked. These amounts are aggregated to represent total historical fees.
- **Key fields**: `feeAmount`, `value`, `token_address`, `from_address`, `to_address`

### Component B: Taker rebate tracking

- **Purpose**: Capture rebate distributions paid back to takers under the order book model
- **Logic**: ERC-20 `Transfer` events of USDC and pUSD from designated rebate distribution addresses to user addresses are tracked, excluding transfers to the protocol wallet. These transfers are filtered to isolate those labeled as taker rebates.
- **Key fields**: `value`, `token_address`, `from_address`, `to_address`

### Component C: Supply-side fee allocation

- **Purpose**: Determine the final supply-side fee amount based on the active protocol phase
- **Logic**: The final supply-side fee amount is determined based on the active protocol phase. For periods prior to the launch of the order book model, supply-side fees are set to equal 100% of the total fees generated by the AMM. For periods on or after the order book launch date, supply-side fees are defined as the total taker rebates distributed to market participants. Polymarket US and Polymarket Combos products are excluded from this calculation.
- **Key fields**: `timestamp`, `fees`, `fees_supply_side`

### Component D: USD conversion and aggregation

- **Purpose**: Normalize fee values and convert them to USD
- **Logic**: Fee and rebate amounts are normalized by decimal precision using asset metadata. The normalized values are multiplied by end-of-day asset prices to convert them to USD. The final values are aggregated daily using UTC day boundaries.
- **Key fields**: `timestamp`, `fees_supply_side`, `price_usd`

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

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

Supply-side fees

Prediction markets

Liquidity providers deposit funds into Polymarket and receive trading fees from traders (supply-side fees). Polymarket has also launched a new peer-to-peer order book with no liquidity providers involved.

Polymarket is a non-custodial prediction market protocol built on Polygon. Polymarket was founded by Shayne Coplan and launched in 2020.

Polymarket team & investors own and govern the protocol. They do not currently take a cut of the total trading fees paid by traders (revenue). Polymarket's investors include Polychain, 1Confirmation, ParaFi Capital, etc.

Polymarket International

Supply-side fees

Supply-side fees

Chain breakdown