Validators process transactions and receive fees from users (supply-side fees).

Terra is a smart contract platform for decentralized applications (a blockchain). Terra was founded by Daniel Shin and Do Kwon and launched in 2018. Terra Classic's stablecoin UST collapsed in 2022 due to a cryptocurrency equivalent of a bank run. Terra was forked shortly after, leading to the current Terra and its predecessor Terra Classic. This dashboard tracks the new Terra blockchain.

LUNA holders own and govern the protocol. They take a cut of the total transaction fees paid by users (revenue) that is then rewarded to contract owners (cost of revenue). Terra’s investors include Coinbase Ventures, Galaxy Digital, Pantera Capital, etc.

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Terra

# Terra Cost of revenue Methodology

## 1. Overview

Cost of revenue for Terra blockchain represents the operational costs associated with running the network, calculated as the total transaction fees paid to developers and validators. For Terra, the cost of revenue equals the revenue, reflecting that all network fees represent costs to maintain and operate the blockchain infrastructure. This metric answers the question: "What are Terra's operational costs for maintaining network security and functionality?"

## 2. Data sources

- **Terra blockchain event attributes**: Event logs containing fee payout information from Terra network transactions, specifically `payout_feeshare` and `juno.feeshare.v1.FeePayoutEvent` events that record fees paid to developers and validators
- **Transaction data**: Terra blockchain transaction records that provide timestamps and context for fee payment events
- **External price feeds**: End-of-day token price feeds from CoinGecko for converting native Terra tokens (LUNA, FDB) to USD values
- **Token metadata**: Mapping data to convert Terra token denominations to standardized CoinGecko identifiers

## 3. Step-by-step calculation

### Component A: Fee extraction from event attributes
- **Purpose**: Extract transaction fees from Terra blockchain event logs
- **Logic**: Parse Terra blockchain event attributes to identify fee payout events of two types: `payout_feeshare` events and `juno.feeshare.v1.FeePayoutEvent` events. These events contain JSON-structured data with fee payment information. Extract the payout arrays from the event attribute values and flatten them to individual payout records. For each payout, extract the token denomination (`denom` field) and fee amount (`amount` field), handling different JSON structures between the two event types
- **Key fields**: `block_timestamp` for timing, `transaction_hash` for transaction identification, `event_type` for event classification, `attribute_value` containing JSON payout data, `amount` and `denom` extracted from the JSON structure

### Component B: Token normalization and mapping  
- **Purpose**: Standardize token denominations and amounts for consistent calculation
- **Logic**: Map Terra-specific token units to standardized CoinGecko identifiers: `uluna` maps to `terra-luna-2`, `FDB` maps to `usd-coin`, and null values default to `usd-coin`. Normalize token amounts by dividing by 1,000,000 (1e6) to convert from micro-unit denominations (common in Cosmos-based chains) to standard token units
- **Key fields**: `unit` for the original token denomination, `coingecko_id` for the mapped identifier, `amount` normalized to standard units

### Component C: Daily aggregation and USD conversion
- **Purpose**: Aggregate fees by day and convert to USD values
- **Logic**: Group the normalized fee data by day using timestamp truncation to daily boundaries. Sum all fee amounts for each day, maintaining the token denomination groupings. Classify Terra as a Layer 1 blockchain in the `blockchains_l1` market sector with `blockchain` business segment. Convert the aggregated native token amounts to USD using end-of-day CoinGecko price feeds, matching token amounts with their corresponding price data by CoinGecko identifier and date
- **Key fields**: `daily_timestamp` for aggregation periods, `coingecko_id` for price matching, `revenue` as the aggregated USD fee amount

### Final aggregation
- **Combining components**: The cost of revenue calculation directly assigns the calculated revenue value as the cost of revenue, reflecting Terra's business model where network fees represent operational costs
- **Currency conversion**: USD conversion occurs using end-of-day CoinGecko price feeds, matching native token amounts with corresponding USD prices by token identifier and transaction date
- **Time aggregation**: Data is aggregated to daily boundaries using timestamp truncation, with gaps filled using zeros to ensure continuous time series
- **Final calculation**: Cost of revenue equals the daily sum of all transaction fees paid to developers and validators, converted to USD. The formula is: Cost of Revenue = Sum of (normalized token amounts × end-of-day USD prices) for all fee payout events per day

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

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Cost of revenue

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