Liquidity providers deposit collateral and mint volatility tokens. Traders can then purchase these volatility tokens to express views on market volatility.

Volmex enables VIX-like indices for crypto assets and trading functionality on Ethereum. Volmex was founded by Cole Kennelly and launched in 2021.

The Volmex team and investors own and govern the protocol. They currently charge a minting and redemption fee (revenue). Volmex’s investors include Three Arrows Capital, Robot Ventures, CMS Holdings etc.

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Volmex

# Volmex Expenses Methodology

## 1. Overview

The Volmex expenses metric measures the total USD value of token incentives paid by the protocol to users. Currently, Volmex does not operate any token incentive programs, so this metric consistently returns zero across all time periods and chains. The calculation framework is designed to accommodate future token incentive programs by leveraging the existing fee calculation infrastructure.

## 2. Data sources

The calculation utilizes several data sources to establish the proper framework for expense tracking:

- **Volmex smart contract events**: Parsed `CollateralToken_Collateralized_event` and `CollateralToken_Redeemed_event` logs from Ethereum, Arbitrum, and Polygon networks containing fee information from vault operations
- **Vault configuration data**: Static mapping of vault contract addresses to their corresponding collateral token addresses across supported chains
- **Token metadata**: Information about supported collateral tokens including DAI and USDC variants across chains
- **End-of-day price feeds**: Token price data for USD conversion and standardization
- **Chain availability data**: Information about which chains are active for each time period

## 3. Step-by-step calculation

### Component A: Vault configuration mapping
- **Purpose**: Establishes the relationship between Volmex vault addresses and their collateral tokens
- **Logic**: Creates a static mapping of vault contract addresses to collateral token addresses across Ethereum, Arbitrum, and Polygon. Each vault is associated with either DAI or USDC collateral tokens, with specific contract addresses for each chain. This mapping includes vault symbols like "ETHV DAI Collateral" and "BTCV USDC Collateral" that identify the underlying volatility asset and collateral type
- **Key fields**: `chain`, `token_symbol`, `vault_address`, `token_address`

### Component B: Trading fee collection
- **Purpose**: Collects fee data from Volmex vault operations to establish the data structure for expense calculations
- **Logic**: Extracts fee information from `CollateralToken_Collateralized_event` and `CollateralToken_Redeemed_event` logs across all supported chains. These events occur when users deposit collateral or redeem positions from Volmex vaults. Each event contains an `fees` field representing trading fees collected. The events are joined with vault configuration data to identify the collateral token for each transaction
- **Key fields**: `block_timestamp`, `transaction_hash`, `address` (vault address), `fees`, `token_address`

### Component C: Fee aggregation and USD conversion
- **Purpose**: Processes raw fee data into standardized daily USD amounts
- **Logic**: Aggregates fee events by day, chain, and token address. Applies decimal correction based on token precision and converts amounts to USD using end-of-day price feeds. This creates a standardized daily fee dataset that serves as the template for token incentive calculations
- **Key fields**: `timestamp`, `chain_id`, `token_address`, `fees` (in USD)

### Component D: Token incentive calculation
- **Purpose**: Calculates actual token incentive expenses paid by the protocol
- **Logic**: Uses the fee data structure as a template but overrides all token incentive values to zero. This reflects Volmex's current policy of not operating token incentive programs. The calculation maintains the same timestamp, chain, and product dimensions as the fee data to ensure consistency
- **Key fields**: `timestamp`, `timestamp_grain`, `product_id`, `chain_id`, `token_incentives` (always 0)

### Final aggregation
- **Combining components**: The token incentive data is directly used as the expense amount, with `token_incentives` renamed to `expenses`
- **Currency conversion**: All amounts are already in USD from the underlying fee calculation framework
- **Time aggregation**: Data is aggregated at daily boundaries using timestamp truncation to day level
- **Final calculation**: The final expenses value equals the token incentives amount, which is consistently zero across all time periods and chains due to the absence of active incentive programs

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

Total project operating and incentive expenses.

Volmex

Expenses

Expenses

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Chain breakdown