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# Shadow Token incentives Methodology

## 1. Overview

Shadow Exchange token incentives measures the daily USD value of xShadow tokens claimed by liquidity providers as rewards from Shadow Exchange gauge contracts. This metric quantifies the token-based incentives distributed to LPs for providing liquidity to Shadow Exchange pools. The calculation focuses specifically on xShadow emissions, which represent the protocol's native token incentives, and converts them to USD for standardized reporting across different time periods.

## 2. Data sources

- **Sonic blockchain event logs**: Parsed `ClaimRewards` events from Shadow Exchange V2 Gauge contracts and V3 GaugeV3 contracts
- **End-of-day token price feeds**: USD price data for Shadow tokens to enable currency conversion
- **Token metadata**: Decimal precision information for accurate token amount calculations

## 3. Step-by-step calculation

### Component A: LP rewards extraction
- **Purpose**: Extracts all reward claim events from Shadow Exchange gauge contracts across protocol versions
- **Logic**: Collects `ClaimRewards` events from both V2 Gauge and V3 GaugeV3 contracts on Sonic blockchain. Events are filtered to exclude removed/reverted transactions. Each event contains the reward token address and claimed amount. Product versions are identified from the contract schema names, mapping V2 contracts to "Constant Product" and V3 contracts to "Concentrated Liquidity"
- **Key fields**: Block timestamp, transaction hash, log index, contract address, `reward` token address, and `amount` of tokens claimed

### Component B: xShadow incentive filtering  
- **Purpose**: Isolates xShadow token rewards from all reward claims to focus on protocol token incentives
- **Logic**: Filters the LP rewards data to include only claims where the reward token matches the xShadow contract address `0x5050bc082ff4a74fb6b0b04385defddb114b2424`. The token address is then standardized to the Shadow token address `0x3333b97138d4b086720b5ae8a7844b1345a33333` for USD conversion purposes. Daily timestamps are created by truncating block timestamps to day boundaries
- **Key fields**: Daily `timestamp`, `chain_id`, `product_id` (protocol version), standardized `token_address`, and `token_incentives` amount

### Component C: USD conversion and decimal correction
- **Purpose**: Converts xShadow token amounts to USD values with proper decimal handling
- **Logic**: Applies Token Terminal's standard conversion macro to transform raw token amounts into USD values using end-of-day price feeds. The conversion process corrects for token decimal precision and applies the appropriate USD exchange rate based on the Shadow token pricing data
- **Key fields**: Original token amounts converted to `token_incentives_usd` with decimal-corrected values

### Final aggregation
- **Combining components**: xShadow rewards are aggregated by day, chain, and product version to create daily incentive totals
- **Currency conversion**: USD conversion uses end-of-day Shadow token prices applied to the decimal-corrected xShadow amounts
- **Time aggregation**: Daily boundary logic truncates block timestamps to create consistent daily reporting periods
- **Final calculation**: The metric represents the total USD value of xShadow tokens claimed as LP rewards each day, with missing dates filled with zero values to maintain continuous time series data

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

Value of native tokens distributed as incentives.

ShadowSHADOW

Token incentives

Token incentives

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