# Venus Flux Supply-side fees Methodology

## 1. Overview

Supply-side fees is calculated as the portion of total fees generated by Venus Flux that is distributed to liquidity providers. Interest income and liquidation penalties remaining after the deduction of protocol reserve factors and revenue requirements are represented by this metric. This metric is utilized as a key indicator of the incentives aVailable to service providers who supply capital to the Venus Flux lending markets.

## 2. Data sources

- **Blockchain events**: `AccrueInterest`, `LiquidateBorrow`, `NewReserveFactor`, and `MarketAdded` events from `vBNB`, `VBep20Delegate`, `VToken`, and `PoolRegistry` contracts, plus `LogCollectRevenue` events from `FluidLiquidity` contracts, covering BNB Chain, Ethereum, Arbitrum, Base, Unichain, and 3 other chains
- **External data**: End-of-day price feeds for underlying assets

## 3. Step-by-step calculation

### Component A: Venus Flux interest and liquidation fee extraction

- **Purpose**: To capture the gross interest and liquidation fees generated by lending activities.
- **Logic**: Interest is identified by parsing `AccrueInterest` events from `vBNB`, `VBep20Delegate`, and `VToken` contracts to extract the accumulated interest amount per market. Liquidation fees are captured from `LiquidateBorrow` events by calculating the value of seized collateral assets, which is determined by multiplying the seized amount by the current exchange rate and applying a 10% fee factor. Markets are filtered based on an allowlist of active lending market addresses.
- **Key fields**: `interestAccumulated`, `seizeTokens`, `exchange_rate`

### Component B: Venus Flux protocol revenue calculation

- **Purpose**: To determine the share of fees retained by the protocol treasury.
- **Logic**: Protocol revenue is calculated by applying a market-specific reserve factor to the accrued interest. These reserve factors are sourced from `NewReserveFactor` events and applied to interest amounts based on the transaction timestamp. For liquidation events occurring after June 1, 2022, protocol revenue is calculated as 5% of the seized collateral value.
- **Key fields**: `reserve_factor`, `interestAccumulated`, `exchange_rate`

### Component C: Venus Flux liquidity layer revenue tracking

- **Purpose**: To account for revenue generated through the Instadapp Fluid liquidity layer integration.
- **Logic**: Revenue is tracked using state resolver data to extract borrow and supply interest, fees, and total revenue metrics. The daily revenue delta is calculated by comparing current and previous day values, adjusted for any revenue collection events identified via `LogCollectRevenue` events from `FluidLiquidity` contracts.
- **Key fields**: `revenue`, `amount`, `token_address`

### Component D: Supply-side fee isolation

- **Purpose**: To calculate the net value distributed to supply-side participants.
- **Logic**: Supply-side fees are derived by subtracting the calculated protocol revenue (Component B) and the liquidity layer revenue (Component C) from the total gross fees (Component A). This ensures that actual yields earned by liquidity providers are accurately reflected by this isolation.
- **Key fields**: `fees`, `revenue`

### Component E: USD conversion and aggregation

- **Purpose**: To normalize all values into a common currency for reporting.
- **Logic**: All extracted asset amounts are normalized by their respective decimal precision. The normalized values are then multiplied by the end-of-day price feeds for the corresponding underlying assets. Values are aggregated at a daily granularity using UTC day boundaries.
- **Key fields**: `price_usd`, `decimals`, `timestamp`

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

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

Supply-side fees

Lending

Lenders deposit funds into Venus and receive interest payments from borrowers (supply-side fees).

Venus is a non-custodial lending protocol built on BNB chain. Venus was founded by Joselito Lizarondo and launched in 2020.

XVS tokenholders own and govern the protocol. They currently take a cut of the total interest paid by borrowers (revenue).

Venus Flux

Supply-side fees

Supply-side fees

Chain breakdown