Liquidity providers deposit funds into Thetanuts and receive option premiums from traders (supply-side fees).

Thetanuts is a non-custodial DeFi Options Vault (DOV) protocol built on Ethereum, Fantom, Polygon, and other blockchains. Thetanuts was founded by Dexter Song and launched in Dec 2021.

Thetanuts team own and govern the protocol. Their investors include Deribit Exchange, QCP Capital, Jump Crypto, etc.

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# Thetanuts Earnings Methodology

## 1. Overview

ThetaNuts earnings measures the net profit generated by the ThetaNuts protocol after subtracting expenses from revenue. This metric answers the business question: "How much profit does ThetaNuts generate for the protocol itself?" The calculation uses the standard accounting formula: earnings = revenue - expenses. However, for ThetaNuts specifically, both revenue and expenses are set to zero, reflecting the protocol's business model where option premiums flow directly to liquidity providers rather than generating protocol revenue, and no token incentives are paid to users.

## 2. Data sources

The earnings calculation relies on the following data sources:
- **Blockchain events**: Parsed `NewEpoch` events from ThetaNuts vault contracts deployed across Ethereum, Arbitrum, Avalanche, BSC, Fantom, and Polygon networks
- **Transaction data**: Ethereum, Arbitrum, Avalanche, BSC, Fantom, and Polygon transaction records providing timestamps, transaction hashes, and log indices for event context
- **External data**: End-of-day token price feeds for underlying vault assets (ETH, BTC, ARB, AVAX, BNB, ADA, BCH, FTM, MATIC, SOL, USDC) used in dimensional structure setup
- **Protocol metadata**: ThetaNuts vault configuration data mapping contract addresses to underlying token addresses and vault types (covered calls vs put vaults)

## 3. Step-by-step calculation

### Component A: Revenue calculation
- **Purpose**: Determines protocol revenue captured by ThetaNuts
- **Logic**: Revenue is explicitly set to zero for all time periods and chains. This reflects ThetaNuts' business model where option premiums collected from users flow directly to liquidity providers (vault depositors) rather than generating revenue for the protocol itself. The dimensional structure (timestamps, chain IDs, product classifications) is inherited from the underlying fees data but the `revenue` field is hardcoded to 0
- **Key fields**: `timestamp` (daily aggregation), `chain_id`, `product_id`, `revenue` (always 0)

### Component B: Expenses calculation
- **Purpose**: Calculates total protocol expenses, primarily token incentives paid to users
- **Logic**: Expenses consist only of token incentives, which are set to zero for all records. This indicates that ThetaNuts does not pay any token rewards or incentives to users. The expenses calculation inherits the same dimensional structure as revenue, ensuring consistent time periods and chain coverage
- **Key fields**: `token_incentives` (always 0), `expenses` (always 0), same dimensional fields as revenue

### Component C: Underlying fees structure (not used in earnings)
- **Purpose**: Provides dimensional framework and demonstrates the protocol's fee collection mechanism
- **Logic**: While not directly used in earnings calculation, the fees data shows how ThetaNuts collects option premiums. Premium amounts are extracted from `NewEpoch` events emitted when new option periods begin on vault contracts. These events contain the `premium` field representing option premiums paid by users. Premium amounts are joined with vault configuration data to identify underlying tokens, then converted to USD using end-of-day price feeds with decimal correction applied. Data is aggregated daily by chain and vault type
- **Key fields**: `block_timestamp`, `account_address`, `chain`, `amount` (premium in native token), `token_address` (for USD conversion)

### Final aggregation
- **Combining components**: Revenue (0) and expenses (0) are combined using the standard earnings formula
- **Currency conversion**: Not applicable since both components are zero, though the underlying structure supports USD denomination
- **Time aggregation**: Daily boundaries based on block timestamps truncated to day level
- **Final calculation**: Earnings = Revenue - Expenses = 0 - 0 = 0 for all time periods and chains. The result reflects that ThetaNuts operates as a fee-through model where premiums flow to liquidity providers rather than generating protocol 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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