# PrimeFi Lending Active loans Methodology

## 1. Overview

The total value of user deposits lent out to borrowers within PrimeFi Lending is measured by the Active loans metric. This metric represents the portion of supplied liquidity that is actively accruing interest, serving as a primary indicator of the protocol's capacity to generate revenue. Active loans are tracked individually for each supported asset and are denominated in USD to facilitate cross-asset analysis.

## 2. Data sources

- **Blockchain events**: `Borrow` and `Repay` events from `LendingPool` contracts, covering the XDC Network
- **External data**: Asset metadata for decimal normalization and end-of-day price feeds for valuation

## 3. Step-by-step calculation

### Component A: Loan flow extraction

- **Purpose**: To identify and capture all changes to the outstanding debt balance.
- **Logic**: `Borrow` and `Repay` events are parsed from `LendingPool` contracts. Each `Borrow` event is recorded as a positive flow, representing an increase in active debt. Each `Repay` event is recorded as a negative flow, representing a reduction in the outstanding loan balance.
- **Key fields**: `amount` (quantity of the asset), `token_address` (identification of the borrowed asset), and `block_timestamp` (timing of the transaction).

### Component B: Cumulative debt aggregation

- **Purpose**: To calculate the total outstanding debt balance for each asset over time.
- **Logic**: Daily net flows are calculated by summing the positive borrow amounts and negative repayment amounts. A running total of these net flows is aggregated chronologically to determine the total active loan balance for every asset on each respective day.
- **Key fields**: `amount` (net daily change) and `timestamp` (daily granularity).

### Component C: Normalization and USD conversion

- **Purpose**: To standardize debt balances by adjusting for decimal precision and converting values to USD.
- **Logic**: Raw asset quantities are normalized by the decimal precision specified in the asset metadata. For valuation purposes, specific assets such as `psXDC` are mapped to representative liquid assets like `WXDC` to ensure accurate pricing. The normalized balances are multiplied by end-of-day price feeds. For days where no transactions occur, the previous day's balance is forward-filled to ensure a continuous and accurate representation of the outstanding debt.
- **Key fields**: `active_loans` (normalized balance), `price_usd` (valuation), and `token_address` (asset mapping).

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

Value of loans currently outstanding to borrowers.

Active loans

PrimeFi Lending

Active loans

Active loans

Chain breakdown