Thales deposits liquidity into marketplaces and receive fees from traders (revenue). The funds collected are used to buyback and burn the THALES governance token.

Thales is a non-custodial exchange for parimutuel contracts built on Optimism, Arbitrum and Polygon. Thales was founded by Danijel Gornjakovic and was launched in December 2021.

THALES tokenholders own and govern the protocol. Thales’ investors include Framework Ventures, Apollo Capital, etc.

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Thales

# Thales Earnings Methodology

## 1. Overview

Earnings measures the net value retained by Thales after subtracting all protocol expenses from its revenue. Protocol revenue is generated from options trading fees collected by `SafeBox` contracts, while expenses are comprised of THALES incentives distributed to stakers and liquidity providers. On-chain profitability is reflected by this metric, which represents the net financial position of the protocol. Because liquidity is provided exclusively by the protocol, 100% of options trading fees are retained as protocol revenue, making earnings directly dependent on the balance between trading volume and incentive emission costs.

## 2. Data sources

- **Blockchain events**: ERC-20 transfers from `Market` contracts to `SafeBox` contracts, `RewardPaid` events from `LPStakingRewards` contracts, and `RewardsClaimed` events from `StakingThales` contracts, covering Arbitrum, Base, Optimism, and Polygon
- **External data**: End-of-day price feeds for traded assets and the THALES incentive asset

## 3. Step-by-step calculation

### Component A: Options trading fee extraction

- **Purpose**: Capture fees generated from options trading on Thales.
- **Logic**: ERC-20 transfers from `Market` contracts to `SafeBox` contracts are identified. Specific ad-hoc, non-recurring transfers on Optimism are excluded via transaction hash filtering. Because liquidity is provided exclusively by the protocol, 100% of these collected fees are classified as protocol revenue.

### Component B: Incentives tracking

- **Purpose**: Capture expenses incurred from protocol incentives.
- **Logic**: `RewardPaid` events from `LPStakingRewards` contracts and `RewardsClaimed` events from `StakingThales` contracts are parsed. The `reward` and `baseRewards` amounts are extracted to measure the total THALES incentives distributed to stakers and liquidity providers.

### Component C: USD conversion and normalization

- **Purpose**: Normalize fee and incentive amounts to USD.
- **Logic**: Collected fee and incentive amounts are normalized by decimal precision and multiplied by end-of-day asset prices.

### Component D: Earnings calculation

- **Purpose**: Calculate net earnings for the protocol.
- **Logic**: Daily expenses (incentives) are subtracted from daily revenue (options trading fees) to determine net earnings.

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

Net profit (also profits, net income, profitability) — revenue remaining after subtracting expenses.

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