# Raydium OpenBook Supply-side fees Methodology

## 1. Overview

Supply-side fees measures the share of trading fees distributed to liquidity providers within Raydium OpenBook. This metric represents the primary incentive for service providers to supply capital to the legacy AMM V4 pools. Supply-side fees are calculated as the residual value of total trading fees after the protocol's revenue share has been deducted.

## 2. Data sources

- **Blockchain events**: Trade records associated with the Raydium OpenBook program account from Solana DEX trade data, covering Solana
- **External data**: End-of-day price feeds for traded assets

## 3. Step-by-step calculation

### Component A: Raydium OpenBook trade extraction

- **Purpose**: Identify and isolate trading activity specifically occurring within Raydium OpenBook pools
- **Logic**: Transactions are filtered from Solana DEX trade records where the executing account or outer executing account matches the Raydium OpenBook program. Base and quote asset quantities are extracted and normalized using decimal precision metadata for each asset.

### Component B: Asset valuation and USD conversion

- **Purpose**: Determine the USD value of trading activity as the basis for fee calculation
- **Logic**: Trade volume is calculated by identifying the USD value of the stablecoin (USDC, USDT) or native SOL side of the pair. If neither asset is a stablecoin or SOL, the asset with the lower USD value is utilized to prevent double-counting. Values are converted to USD using end-of-day price feeds.

### Component C: Total fee and protocol revenue determination

- **Purpose**: Apply the relevant fee tiers and protocol take rates to the trading volume
- **Logic**: A fixed trade fee rate of 0.25% is applied to the total trading volume to determine gross fees. Protocol revenue is then calculated by applying a 3% protocol take rate to the gross fees. This 3% portion is designated as protocol revenue, while the remaining 97% is allocated to the supply-side.

### Component D: Supply-side fee aggregation

- **Purpose**: Consolidate the net fees earned by liquidity providers
- **Logic**: Supply-side fees are derived by subtracting protocol revenue from the total fees. The resulting values are aggregated by day to provide a final daily metric. Daily granularity is maintained using UTC day boundaries.

*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

Exchanges (DEX)