Artists can launch their music NFT editions through Sound.xyz and collect edition purchase payments (supply-side fees).

Sound.xyz is an NFT launchpad built for musicians and artists. Sound.xyz was founded by Vignesh Hirudayakanth, David Greenstein & Matt Masurka and launched in 2021.

Sound.xyz team owns and governs the protocol. They currently take a protocol fee of edition purchases (revenue).

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Sound.xyz

# Sound.xyz Fees Methodology

## 1. Overview

Sound protocol fees represent the total fees that accrue to creators and the protocol from both primary and secondary sales of music NFTs. This metric captures revenue generated from minting music collectibles (primary sales) as well as royalty fees from secondary trading on Sound Swap. The calculation combines the full mint price from primary sales with artist royalty fees from secondary sales, providing a comprehensive view of fee generation across the Sound ecosystem.

## 2. Data sources

- **Primary sale events**: Parsed `Minted` events from various Sound minter contracts including `MerkleDropMinter`, `RangeEditionMinter`, and legacy `Artist` contracts on Ethereum and Optimism
- **Secondary sale events**: Parsed `Bought` and `Sold` events from Sound Swap (`SAM`) contracts on Ethereum and Optimism  
- **Price change events**: Parsed `EditionCreated` events from legacy `Artist` contracts on Ethereum used to track price modifications over time
- **Token price feeds**: End-of-day token price feeds for USD conversion
- **Token metadata**: Token decimal information for amount standardization

## 3. Step-by-step calculation

### Component A: Primary sale fees from minter contracts
- **Purpose**: Captures fees from primary sales of music NFTs through various minter contracts
- **Logic**: Extracts `Minted` events from `MerkleDropMinter` (permissioned drops) and `RangeEditionMinter` (fixed price editions) contracts across Ethereum and Optimism. For each mint event, uses the `requiredEtherValue` field as the fee amount, representing the full mint price paid. Groups events by contract address, transaction hash, log index, NFT address, and timestamps truncated to daily boundaries. Classifies all as "Primary sales" volume type with "NFT marketplace" business line.
- **Key fields**: `requiredEtherValue` as fee amount, `edition` as NFT address, `quantity` as mint count, `platformFee` as protocol fee component

### Component B: Primary sale fees from legacy artist editions  
- **Purpose**: Captures fees from legacy artist edition purchases with dynamic pricing
- **Logic**: Extracts `EditionPurchased` events from legacy `Artist` and `ArtistV1` contracts on Ethereum. Since these contracts allowed price changes over time, joins purchase events with price change data from `EditionCreated` events using temporal matching logic. Matches purchases to the correct price by ensuring the purchase timestamp falls within the validity period of each price (from creation timestamp to the next price change or null for the latest price). Uses the matched price amount as the fee.
- **Key fields**: `numSold` as mint count, matched `price` from price changes as fee amount, artist contract `address` as NFT address

### Component C: Secondary sale royalty fees
- **Purpose**: Captures artist royalty fees from secondary trading on Sound Swap
- **Logic**: Extracts `Bought` events from Sound Swap (`SAM`) contracts on Ethereum and Optimism. Uses the `artistFee` field as the royalty fee amount paid to creators. Also processes `Sold` events but these have null royalty fees since fees are only collected on the buy side. Groups by transaction details and NFT address, classifying as "Secondary sales (Sound Swap)" volume type.
- **Key fields**: `artistFee` as royalty fee amount (buy events only), `edition` as NFT address, `totalPayment` as gross sale amount

### Component D: Price change tracking for legacy editions
- **Purpose**: Maintains price validity periods for legacy artist editions
- **Logic**: Processes `EditionCreated` events from `Artist` contracts to track when prices were set. Creates time ranges using window functions to determine when each price was valid (from creation timestamp until the next price change). This enables correct price matching for purchases that occurred at different time periods.
- **Key fields**: `price` as fee amount, creation and validity timestamps for temporal matching

### Final aggregation
- **Combining components**: Unions primary sale fees (from both minter contracts and legacy editions) with secondary sale royalty fees into a single dataset. All fee amounts are mapped to a common `fees` field regardless of source type.
- **Currency conversion**: Applies USD conversion using end-of-day token price feeds matched to the transaction date. Corrects token amounts for decimal places using token metadata. Handles both ETH (Ethereum) and WETH (Optimism) as native tokens.
- **Time aggregation**: Truncates all timestamps to daily boundaries and groups fees by day, chain, NFT address, and volume type. Applies zero-filling strategy to ensure complete daily time series with no gaps.
- **Final calculation**: Sums all fee amounts in USD for each day, providing total fees accruing to creators and the protocol from both primary mints (full mint price) and secondary royalties (artist fees only). Filters results based on chain data availability to ensure completeness.

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

Total value users pay to use a protocol (gross fees, user-paid fees).

Sound.xyz

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