Toucan receives fees when liquid carbon reference tokens are redeemed for carbon credits and when off-chain carbon credits are bridged on-chain (revenue).

Toucan is an infrastructure protocol that bundles illiquid carbon credits to liquid carbon reference tokens, and bridges off-chain carbon credits on-chain. Toucan is currently built on Polygon and was founded by Raphaël Haupt in 2020.

Toucan team & investors own and govern the protocol. Toucan’s investors include USV, Earthshot Ventures, etc.

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Toucan Protocol

# Toucan Protocol Earnings Methodology

## 1. Overview

Toucan earnings represents the net profit generated by the Toucan Protocol from carbon credit redemption activities. The metric is calculated as revenue minus expenses, where revenue comes from fees collected when users redeem tokenized carbon credits (TCO2 tokens) through Toucan's Base Carbon Tonne (BCT) and Nature Carbon Tonne (NCT) pools. Currently, Toucan has no token incentive expenses, making earnings equal to revenue.

## 2. Data sources

The calculation relies on the following raw data sources:
- **Blockchain events**: Parsed `Transfer` events from Polygon and Celo networks capturing token transfers to Toucan protocol addresses
- **Transaction data**: Token transfer records showing redemption fee payments to ecosystem funds and retirement pools
- **External data**: End-of-day token price feeds for USD conversion and token metadata for decimal correction
- **Protocol data**: Toucan smart contract addresses for ecosystem funds and carbon pool retirement contracts
- **Filter data**: Denylisted token addresses to exclude scam tokens from revenue calculations

## 3. Step-by-step calculation

### Component A: Redemption fee extraction
- **Purpose**: Identifies and extracts fees paid to Toucan protocol during carbon credit redemptions
- **Logic**: Queries token transfer events where the recipient address matches specific Toucan protocol addresses. These include ecosystem fund addresses and retirement pool addresses for both BCT and NCT carbon pools on Polygon and Celo networks. The system tracks six specific addresses: ecosystem funds on both chains, and BCT/NCT retirement pools on both chains. Only transfers that are not flagged as removed and do not involve denylisted scam tokens are included.
- **Key fields**: Block timestamp for daily aggregation, transaction hash and log index for uniqueness, recipient address (`to_address`), token contract address, and transfer amount (`value`)

### Component B: Cross-chain normalization
- **Purpose**: Standardizes token addresses across chains for consistent USD conversion
- **Logic**: Maps Celo token addresses to their Polygon equivalents since USD conversion uses Polygon-based price feeds. Specifically maps Celo NCT and BCT token addresses to their corresponding Polygon addresses. Sets the processing chain as Polygon while preserving the original chain information for tracking purposes.
- **Key fields**: Original chain identifier (`real_chain`), processing chain (`chain`), mapped token address, and transfer amount

### Component C: USD conversion and decimal correction
- **Purpose**: Converts token amounts to standardized USD values
- **Logic**: Applies decimal correction based on token metadata to account for different token decimal places, then converts corrected amounts to USD using end-of-day token price feeds. Uses the mapped Polygon token addresses to ensure consistent price lookups across both Polygon and Celo transactions.
- **Key fields**: Corrected token amount, USD exchange rate, and final USD value (`revenue`)

### Component D: Revenue aggregation
- **Purpose**: Aggregates daily revenue from all redemption fees
- **Logic**: Groups USD-converted redemption fees by day using timestamp truncation and sums all fee amounts. Classifies revenue under the 'Asset management' business line with 'infrastructure' market sector. Applies gap-filling with zeros for days with no activity to ensure continuous time series data.
- **Key fields**: Daily timestamp (`timestamp`), aggregated revenue amount, business classification fields

### Component E: Expenses calculation
- **Purpose**: Calculates total protocol expenses
- **Logic**: Currently sets all token incentive expenses to zero since Toucan does not operate any token incentive programs. Takes the revenue time series structure and replaces revenue values with zero to create the expenses time series.
- **Key fields**: Daily timestamp matching revenue structure, zero-valued expenses amount

### Final aggregation
- **Combining components**: Subtracts daily expenses from daily revenue using the `calculate_earnings` macro, which performs a simple arithmetic subtraction for each day
- **Currency conversion**: All amounts are already converted to USD during the revenue calculation phase using end-of-day price feeds
- **Time aggregation**: Data is aggregated at daily boundaries using timestamp truncation to day level
- **Final calculation**: Earnings equals revenue minus expenses, which currently equals revenue since expenses are zero (earnings = revenue - 0 = revenue)

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

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

Toucan Protocol

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