# Robinhood Chain Cost of revenue Methodology

## 1. Overview

Cost of revenue is defined as the expenses incurred by Robinhood Chain when outsourcing core operations to third-party service providers and infrastructure partners. For Robinhood Chain, these expenses are comprised of L1 settlement fees paid to Ethereum for batch posting and license fees paid to the Arbitrum Foundation under the Arbitrum Expansion Program (AEP). These payments are aggregated and converted to USD to represent the total operational cost of maintaining the rollup infrastructure.

## 2. Data sources

- **Blockchain events**: L1 batch-posting transactions on Ethereum and native asset flows for RewardDistributor fee accounts on Robinhood Chain, covering Ethereum and Robinhood Chain
- **External data**: End-of-day price feeds for native gas assets

## 3. Step-by-step calculation

### Component A: L1 settlement fee calculation

- **Purpose**: Capture the gas costs incurred on Ethereum for settling Robinhood Chain batches.
- **Logic**: Transactions sent by the designated batch poster sequencer address (`0xdaa526086787d9debe1d7f3ffdb1fe50cf8687f4`) are filtered from Ethereum transaction data. For each transaction, the gas cost is calculated by multiplying the gas used by the effective gas price, and adding the product of blob gas used and blob gas price. The resulting fee amounts are normalized by decimal precision to represent the total WETH spent on L1 settlement.
- **Key fields**: `block_timestamp`, `gas_price`, `blob_gas_price`, `gas_used_amount`, `blob_gas_used_amount`

### Component B: Arbitrum Expansion Program license fee calculation

- **Purpose**: Calculate the license fees owed to the Arbitrum Foundation under the Arbitrum Expansion Program.
- **Logic**: Native Ether flows are tracked for the designated RewardDistributor fee accounts on Robinhood Chain. Inflows from fee collections and outflows from refunds are aggregated to determine the net fee-account inflow. A fee rate is then applied to this net inflow to calculate the final license fee amount.
- **Key fields**: `block_timestamp`, `value`

### Component C: USD conversion and aggregation

- **Purpose**: Combine the cost components and normalize them to USD.
- **Logic**: The L1 settlement fees and the AEP license fees are aggregated by day. The daily totals are converted to USD using end-of-day price feeds for the native assets. Zero-filling is applied to ensure continuity across all days.
- **Key fields**: `timestamp`, `cost_of_revenue`

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

Expenses paid to third parties to deliver core service output.

Cost of revenue

Robinhood Chain

Cost of revenue

Cost of revenue

Chain breakdown