Liquidity providers deposit funds into Verse and receive trading fees from traders (supply-side fees).

Verse is an automated market maker-based decentralized exchange built on Ethereum. Verse was created by Bitcoin.com, and launched in 2022.

VERSE tokenholders own and govern the protocol. They currently take a cut of the total trading fees paid by traders (revenue). Verse's investors include Blockchain.com, KuCoin Ventures and others.

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Verse

# Verse Average revenue per user (ARPU) Methodology

## 1. Overview

Average Revenue Per User (ARPU) measures the average daily revenue generated per active user on the VerseX decentralized exchange. This metric is calculated by dividing the daily protocol revenue by the number of daily active users (traders). ARPU helps evaluate the monetization efficiency and user value generation of the VerseX protocol, providing insight into how much revenue each active user contributes on average.

The calculation uses a ratio approach: `ARPU = Daily Revenue ÷ Daily Active Users`, where revenue comes from protocol fees on trading activity and active users are unique addresses that executed trades each day.

## 2. Data sources

The ARPU calculation relies on several key data sources:

- **VerseX V1 swap events**: Parsed `Swap` events from VerseX V1 smart contracts on Ethereum containing token amount changes, pair addresses, and transaction details
- **VerseX pair creation events**: Parsed `PairCreated` events from VerseX factory contracts containing trading pair metadata and fee tier information  
- **Ethereum transaction records**: Transaction data providing user addresses (`from_address`) for identifying traders
- **Token metadata**: Token information including decimal places and symbols for proper amount calculations
- **End-of-day price feeds**: Daily token price data in USD for converting trading volumes and fees to dollar amounts
- **Trading pair dimensions**: Metadata about token pairs including addresses, symbols, decimals, and fee tiers

All data is sourced from Ethereum mainnet starting from June 14, 2022, when VerseX V1 was deployed.

## 3. Step-by-step calculation

### Component A: Trading pair identification
- **Purpose**: Identifies all trading pairs and their metadata for fee calculations
- **Logic**: Extracts trading pairs from `PairCreated` events, capturing `token0_address`, `token1_address`, and pair contract addresses. Applies a fixed fee tier of 0.3% (3000/1000000) for all pairs. Joins with token metadata to get decimal places and symbols for each token in the pair, creating human-readable pair names like "USDC-WETH"
- **Key fields**: `account_address` (pair contract), `token0_address`, `token1_address`, `fee_tier`, `token0_decimals`, `token1_decimals`

### Component B: Trade event processing  
- **Purpose**: Captures individual trading transactions and calculates token amount changes
- **Logic**: Processes `Swap` events from VerseX pair contracts, calculating net token amount changes for each trade by subtracting outputs from inputs (`amount0In - amount0Out`, `amount1In - amount1Out`). Joins with Ethereum transaction records to identify the actual user address (`from_address`) rather than just the contract caller. Filters to include only trades from June 14, 2022 onwards
- **Key fields**: `block_timestamp`, `transaction_hash`, `user_address`, `token0_amount`, `token1_amount`, `account_address`

### Component C: Trading volume calculation
- **Purpose**: Converts raw token amounts to USD trading volumes
- **Logic**: Joins trade events with trading pair metadata to get token decimals, then corrects token amounts by dividing by 10 raised to the token's decimal places. Aggregates trades by day, transaction, and user. Joins with end-of-day price feeds for both tokens in each pair, multiplying corrected token amounts by their respective USD prices. Takes the minimum USD value between the two tokens to prevent price manipulation from affecting volume calculations
- **Key fields**: `timestamp` (daily), `trading_volume` (USD), `user_address`, `fee_tier`

### Component D: Fee and revenue calculation
- **Purpose**: Calculates protocol fees and revenue from trading activity
- **Logic**: Multiplies each trade's USD volume by the 0.3% fee tier to get total fees collected. Applies a protocol fee share of 1/6 (approximately 16.67%) to determine the portion that goes to the protocol as revenue, with the remainder going to liquidity providers. Aggregates fees and revenue by day across all trading pairs
- **Key fields**: `fees` (total), `revenue` (protocol share), `timestamp`

### Component E: Daily active user counting
- **Purpose**: Counts unique users who traded each day
- **Logic**: Identifies distinct user addresses that executed at least one trade per day from the processed trade events. Uses HyperLogLog (HLL) sketches for efficient distinct counting, which provides approximate but highly accurate counts while being computationally efficient. Creates multiple dimensional breakdowns including project-level totals, chain-level counts, and user-type counts (all users are classified as "Trader" type)
- **Key fields**: `user_dau` (count), `timestamp`, `user_type`, `chain`

### Final aggregation
- **Combining components**: The final ARPU calculation divides daily revenue by daily active users using a specialized macro. Revenue data (in USD) is joined with user count data on the same daily timestamp to ensure aligned time periods
- **Currency conversion**: All monetary values are converted to USD using end-of-day token prices, ensuring consistent currency representation across different token pairs
- **Time aggregation**: Both revenue and user metrics are aggregated to daily boundaries using timestamp truncation, with time zones normalized to ensure consistent daily cutoffs
- **Final calculation**: ARPU is calculated as daily protocol revenue divided by daily active users, producing an average revenue per user value in USD. Days with zero users result in zero ARPU values rather than null or infinite values

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

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Average revenue per user (ARPU)

Average revenue per user (ARPU)

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