Liquidity providers deposit funds into QuickSwap and receive trading fees from traders (supply-side fees).

QuickSwap is a non-custodial exchange protocol built on Polygon. QuickSwap was founded by Nick Mudge & Sameep Singhania and launched in 2020.

QUICK tokenholders own and govern the protocol. They currently take a cut of the total trading fees paid by traders (revenue).

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QuickSwap

# QuickSwap Liquidity turnover Methodology

## 1. Overview

Liquidity turnover measures the capital efficiency of QuickSwap by calculating the ratio of trading volume to total value locked (TVL). This metric indicates how effectively the liquidity provided to the decentralized exchange is being utilized to facilitate trades. A higher turnover ratio suggests that liquidity is being used more frequently, providing a view into the productivity of the assets held within the protocol's liquidity pools across QuickSwap V2 and QuickSwap V3.

## 2. Data sources

- **Blockchain events**: `Swap` and `Sync` events from `Pair` contracts, and `Swap`, `Mint`, `Collect`, `Flash`, `Fee`, and `CommunityFee` events from `Pool` contracts, covering Polygon, Base, and Manta
- **External data**: End-of-day price feeds for assets and asset metadata

## 3. Step-by-step calculation

### Component A: Trading volume calculation

- **Purpose**: Capture the total value of swap activity across all supported versions and chains.
- **Logic**: `Swap` events are parsed from `Pair` contracts (QuickSwap V2) and `Pool` contracts (QuickSwap V3). For QuickSwap V2, the change in token amounts is calculated as the difference between the incoming and outgoing amounts for each asset in the pair. For QuickSwap V3, the amount is extracted directly from the event parameters. Trading pairs identified in a denylist due to limited price feed support are excluded. To mitigate the impact of price manipulation, the USD value of each trade is determined by taking the lesser USD value between the two assets involved in the swap. Amounts are normalized by decimal precision and multiplied by end-of-day asset prices.

### Component B: Total value locked (TVL) tracking

- **Purpose**: Determine the total value of assets held in the protocol's liquidity pools.
- **Logic**: TVL is derived from the cumulative sum of net deposits. For QuickSwap V2, asset balances are tracked using `Sync` events from `Pair` contracts to identify reserve updates. For QuickSwap V3, net flows are calculated by aggregating `Mint` (deposits), `Collect` (withdrawals), and `Swap` (trades) events from `Pool` contracts. Additionally, `Flash` events from `Pool` contracts are parsed to capture flash loan fees, which are calculated by multiplying the loan amount by the current `fee_tier` identified in `Fee` events. All asset flows are normalized by decimal precision, converted to USD using end-of-day price feeds, and aggregated to determine the daily TVL.

### Component C: Liquidity turnover derivation

- **Purpose**: Calculate the final efficiency ratio.
- **Logic**: The daily trading volume is divided by the daily TVL. If the TVL for a given day is zero, the turnover is set to zero to prevent division errors. The resulting value represents the number of times the protocol's liquidity was utilized to facilitate trading volume during the 24-hour period. Data is aggregated with daily granularity using UTC day boundaries.

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

Trading volume divided by total liquidity.

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Liquidity turnover

Liquidity turnover

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