website

twitter

discord

github

Asset management

Reserve

# Reserve Supply-side fees Methodology

## 1. Overview

Supply-side fees for Reserve Protocol represent the value of RToken burns that occur through the protocol's furnace mechanism. These burns effectively reduce the total supply of RTokens and represent a form of value accrual to remaining token holders. The metric captures the daily USD value of tokens permanently removed from circulation through the furnace burn process across Reserve's yield-bearing RToken products on Ethereum, Base, and Arbitrum.

## 2. Data sources

- **Protocol creation events**: Parsed `RTokenFactory_RTokenCreated` events from Ethereum, Base, and Arbitrum that identify when new Reserve yield markets (RTokens) are deployed
- **Furnace configuration events**: Parsed `RTokenMain_FurnaceSet` events from Ethereum, Base, and Arbitrum that map furnace contract addresses to their corresponding RToken markets
- **Token burn transactions**: Token transfer events from furnace contract addresses to null addresses (`0x0000000000000000000000000000000000000000`) or dead addresses (`0x000000000000000000000000000000000000dead`) representing permanent token burns
- **Price data**: End-of-day token price feeds for USD conversion of burn amounts
- **Token metadata**: Token decimal precision data for accurate amount calculations

## 3. Step-by-step calculation

### Component A: Reserve market identification
- **Purpose**: Identify and classify Reserve Protocol yield markets (RTokens) across supported chains
- **Logic**: Parse `RTokenFactory_RTokenCreated` events from Reserve Protocol versions 1, 2, and 3 on Ethereum, Base, and Arbitrum. Extract the RToken contract address (`rtoken_address`), configuration contract address (`config_address`), and staked token address (`staked_token_address`). Classify products as either 'Reserve Rights' for specific hardcoded stablecoin addresses or 'Reserve Yield' for all other RTokens. Map each market to its deployment chain.
- **Key fields**: `chain_id`, `config_address`, `rtoken_address`, `product_id`

### Component B: Furnace address mapping
- **Purpose**: Map furnace contract addresses to their corresponding RToken markets
- **Logic**: Parse `RTokenMain_FurnaceSet` events to extract furnace addresses (`furnace_address`) and their associated configuration contracts (`config_address`). Join with the market identification data to link each furnace to its specific RToken market and product classification. This creates the mapping needed to identify which token burns belong to which Reserve products.
- **Key fields**: `chain_id`, `product_id`, `config_address`, `furnace_address`

### Component C: RToken burn extraction
- **Purpose**: Identify and quantify actual RToken burn transactions
- **Logic**: Filter token transfer events to find transfers originating FROM furnace contract addresses and going TO either null addresses or dead addresses. These represent permanent token burns as tokens sent to these addresses are effectively removed from circulation. Extract the burn amount (`amount`), transaction details, and link to the corresponding product classification through the furnace address mapping.
- **Key fields**: `block_timestamp`, `chain_id`, `token_address`, `product_id`, `amount`

### Component D: Daily aggregation and USD conversion
- **Purpose**: Convert burn amounts to USD and aggregate by day
- **Logic**: Truncate block timestamps to daily boundaries. Apply decimal correction based on each token's precision and convert burn amounts to USD using end-of-day price feeds. Sum all burns that occurred on the same day for the same chain and product combination to get total daily supply-side fees.
- **Key fields**: `timestamp`, `timestamp_grain`, `chain_id`, `product_id`, `fees_supply_side`

### Final aggregation
- **Combining components**: Daily burn amounts are summed across all furnace addresses within each product and chain combination
- **Currency conversion**: USD conversion uses end-of-day token prices with proper decimal adjustment for each token type
- **Time aggregation**: Burns are aggregated to daily boundaries using timestamp truncation
- **Final calculation**: The final supply-side fees metric represents the total USD value of RTokens permanently burned through Reserve Protocol furnaces on each day, providing a measure of value accrual to remaining token holders through supply reduction

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

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

ReserveRSR

Supply-side fees

Supply-side fees

Competitive landscape

Chain breakdown