Liquidity providers deposit funds into Ribbon Protocol and receive option premiums from traders & withdrawal fees from other liquidity providers (supply-side fees).

Ribbon Finance is a non-custodial asset management protocol built on Ethereum. Ribbon Finance was founded by Julian Koh & Ken Chan and launched in 2021.

RBN tokenholders own and govern the protocol. They currently take a cut of the total premiums and management fees paid by liquidity providers (revenue).

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Ribbon Finance

# Ribbon Finance Expenses Methodology

## 1. Overview

The Ribbon Protocol expenses metric measures the daily cost of token incentive distributions paid out by the protocol to users and liquidity providers. This metric treats all RBN token incentives as operational expenses, providing insight into the protocol's cost structure for user acquisition and retention. The calculation aggregates token distributions from Ribbon's incentive system, converts them to USD values, and reports them as daily expenses.

## 2. Data sources

The expenses calculation relies on several key data sources:

- **Ribbon contract events**: Parsed Ethereum event logs from Ribbon v2 contracts, specifically `Minter_Minted_event` and `Pool_RewardWithdrawn_event` which capture token incentive distributions
- **Token transfer data**: Ethereum token transfer events that record the actual movement of RBN tokens from Ribbon's incentive accounts to recipient addresses
- **End-of-day price feeds**: Token pricing data used to convert RBN token amounts into USD values
- **Token metadata**: Information about token decimal places and contract addresses for proper unit conversion

## 3. Step-by-step calculation

### Component A: Token incentive event extraction
- **Purpose**: Identifies all token incentive distribution events from Ribbon's protocol contracts
- **Logic**: Extracts two types of events from Ribbon v2 Ethereum contracts. The first type captures `Minter_Minted_event` logs which record direct token minting to recipient addresses. The second type captures `Pool_RewardWithdrawn_event` logs which record reward withdrawals from liquidity pools. Each event includes recipient address, transaction details, and timestamp information
- **Key fields**: Event timestamp (`block_timestamp`), recipient address (`recipient` or `account`), transaction hash, and log index for event identification

### Component B: Token transfer verification
- **Purpose**: Validates incentive events by matching them with actual token transfer records
- **Logic**: Joins each incentive event with corresponding Ethereum token transfer data to confirm actual RBN token movement. For `Minter_Minted_event`, matches recipient address with transfer recipient and minter contract address with transfer sender. For `Pool_RewardWithdrawn_event`, matches account address with transfer recipient and filters for transfers from the specific incentive account address (`0x312853485a41f76f20a14f927cd0ea676588936c`). Only includes transfers of RBN token (`0x6123b0049f904d730db3c36a31167d9d4121fa6b`)
- **Key fields**: Transfer `value` (token amount), `from_address` and `to_address` for matching, transaction hash for linking events

### Component C: Daily aggregation and classification
- **Purpose**: Groups token incentive amounts by day and applies protocol classification
- **Logic**: Truncates event timestamps to daily boundaries and sums all token incentive amounts per day. Classifies all distributions under "Asset management" business line, "asset_management" market sector, and "yield_aggregator" business segment. Assigns version "v2" to all incentives and leaves product classification null for aggregated reporting
- **Key fields**: Daily `timestamp`, aggregated `amount` values, classification fields for business categorization

### Final aggregation: Currency conversion and expense reporting
- **Combining components**: Sums all daily token incentive distributions across both event types to calculate total daily incentive costs
- **Currency conversion**: Applies decimal correction based on RBN token's decimal places, then converts token amounts to USD using end-of-day price feeds matched to the distribution date
- **Time aggregation**: Maintains daily granularity with timestamp truncation to day boundaries, ensuring all incentives within a day are grouped together
- **Final calculation**: The final expenses value equals the USD value of all RBN token incentives distributed on each day, treating these distributions as operational costs for the protocol. Uses a zero-fill strategy to ensure continuous time series reporting, showing zero expenses on days with no incentive distributions

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

Total project operating and incentive expenses.

Ribbon FinanceRBN

Expenses

Expenses

Competitive landscape

Chain breakdown