Liquidity providers deposit funds to the lending pool and receive a portion of the interest (supply-side fees).

TrueFi is a non-custodial lending protocol built on Ethereum offering undercollateralized loans for verified borrowers. TrueFi was founded by Rafael Cosman and launched in 2020.

TRU tokenholders own and govern the protocol. They currently take a cut of the interest and an origination fee (revenue). TrueFi’s investors include a16z, BlockTower Capital, Alameda Research etc.

github

twitter

discord

etherscan

website

Lending

TrueFi

# TrueFi Supply-side fees Methodology

## 1. Overview

Supply-side fees represent the portion of interest payments that TrueFi distributes to liquidity providers (lenders) across its three protocol versions. This metric captures the earnings that flow to the supply-side of the lending marketplace, excluding protocol fees. The calculation methodology differs across TrueFi versions due to evolving protocol architecture and fee structures.

## 2. Data sources

- **TrueFi V1 lending events**: Parsed `Pool_Borrow_event` logs from Ethereum containing loan origination data and fee information
- **Ethereum token transfer events**: `Transfer` events filtered by TrueFi market addresses to track actual loan and repayment amounts
- **TrueFi V2 lending calls**: Parsed `TrueLender_fund_function` call traces from Ethereum representing loan funding transactions
- **TrueFi V2 settlement events**: Parsed `LoanToken_Settled_event` logs from Ethereum tracking successful loan repayments
- **TrueFi V2 liquidation events**: Parsed `SAFU_Liquidated_event` logs from Ethereum identifying defaulted loans
- **TrueFi V3 portfolio events**: Parsed `ManagedPortfolio_BulletLoanCreated_event` logs from Ethereum containing individual loan details
- **TrueFi V3 portfolio factory events**: Parsed `ManagedPortfolioFactory_createPortfolio_function` calls and `ManagedPortfolioFactory_PortfolioCreated_event` logs for portfolio metadata
- **TrueFi V3 fee change events**: Parsed `ManagedPortfolio_ManagerFeeChanged_event` logs tracking portfolio-specific fee adjustments
- **Token metadata**: Token contract information including symbols and decimal places for proper amount calculation
- **End-of-day price feeds**: Token price data for USD conversion of fee amounts

## 3. Step-by-step calculation

### Component A: TrueFi V1 interest calculation
- **Purpose**: Calculate interest earned on V1 loans where 100% goes to supply-side
- **Logic**: Extract loan originations from `Pool_Borrow_event` logs and match with token transfers from predefined market addresses to determine loan amounts including fees. Track loan repayments by identifying token transfers TO the same escrow addresses from external addresses (excluding market addresses). Aggregate both borrows and repayments by escrow address and calculate interest as the difference between total repayments and total borrowed amounts. Only process loans originated before V2 launch date of May 29, 2021. Filter by hardcoded market addresses and supported token addresses (TUSD, USDC, USDT, BUSD).
- **Key fields**: `block_timestamp` for timing, `escrow_address` for loan identification, `token_address` for asset type, `amount` for repayment amounts, `fee` for origination fees, calculated `interest` as repayment minus principal

### Component B: TrueFi V2 interest calculation  
- **Purpose**: Calculate interest earned on V2 loans where 90% goes to supply-side (10% protocol cut)
- **Logic**: Extract loan fundings from `TrueLender_fund_function` call traces matched with token transfers to loan contracts to determine funded amounts. Track successful repayments from `LoanToken_Settled_event` logs containing the `returnedAmount` field. Exclude any loans that appear in liquidation events (`SAFU_Liquidated_event`) from repayment calculations. Aggregate borrows and repayments by escrow address (loan contract), calculate interest as repayments minus borrows but only if repayments exceed borrows (otherwise set to zero). Apply the protocol's 10% fee by multiplying interest by 0.9 to get supply-side portion.
- **Key fields**: `block_timestamp` for timing, `escrow_address` (loan contract) for identification, `token_address` for asset type, `returnedAmount` from settlement events, calculated `interest` after protocol fee deduction

### Component C: TrueFi V3 interest calculation
- **Purpose**: Calculate interest earned on individual V3 bullet loans where 100% goes to supply-side  
- **Logic**: Track individual loans using `ManagedPortfolio_BulletLoanCreated_event` logs that contain unique loan IDs, principal amounts, and loan durations. Calculate expected repayment timestamps by adding loan duration (in seconds) to loan creation time. Generate synthetic repayment records with expected repayment amounts from the loan creation events. Match portfolio addresses with portfolio metadata from factory creation events to get token addresses and portfolio names. Join with manager fee change events to apply time-appropriate fee rates, falling back to initial rates if no changes occurred. Aggregate by loan ID and calculate interest as actual repayment amount minus principal amount, but only for loans where repayment amount exceeds principal.
- **Key fields**: `loan_id` for individual loan tracking, `portfolio_name` for identification, `token_address` for asset type, `principalAmount` and `repaymentAmount` for interest calculation, `loanDuration` for timing

### Final aggregation
- **Combining components**: Union all three version calculations preserving timestamp, chain, version, token address, and calculated supply-side fee amounts. Apply different business line and market sector labels consistently across versions.
- **Currency conversion**: Convert token amounts to USD using end-of-day price feeds matched by token address and date. Apply decimal correction based on each token's decimal precision before price conversion to ensure accurate USD amounts.
- **Time aggregation**: Truncate all timestamps to daily boundaries and aggregate fees by day, token, and version. Handle any duplicate records that might arise from the union operation.
- **Final calculation**: Sum daily supply-side fee amounts across all versions and tokens to produce the final metric value representing total daily earnings distributed to TrueFi liquidity providers.

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

Portion of fees distributed to service providers or supply-side participants.

TrueFiTRU

Supply-side fees

Supply-side fees

Competitive landscape