Miners process transactions and receive fees from users (supply-side fees).

Zcash is a distributed ledger for transfer and store of value (a blockchain). Zcash was founded by Matthew Green, Ian Miers, Christina Garman and launched in 2016.

ZEC holders own and govern the protocol. They currently do not take a cut of the total transaction fees paid by users (revenue). Zcash’s investors include Fenbushi Capital, Pantera Capital, Digital Currency Group, etc.

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Zcash

# Zcash Supply-side fees Methodology

## 1. Overview

Fees supply-side represents the total transaction fees paid by users and collected by Zcash miners on a daily basis, expressed in USD. This metric captures the revenue generated by the network's fee market, measuring the economic value transferred from users to miners for transaction processing. The calculation follows Zcash's UTXO (Unspent Transaction Output) model, where fees are determined by the difference between transaction inputs and outputs, adjusted for the protocol's shielded pool value balance mechanism.

## 2. Data sources

The methodology relies on the following raw data sources:

- **Zcash blockchain transaction data**: Complete transaction records including inputs, outputs, and metadata from the Zcash blockchain
- **Transaction input/output data**: Detailed UTXO data showing value transfers, including `txid`, output indices, and `valueZat` amounts
- **Shielded pool data**: Sapling `value_balance_zat`, Orchard `orchard.valueBalanceZat`, and Sprout `join_splits.vpub_oldZat`/`vpub_newZat` fields that account for value movements across all four Zcash value pools
- **End-of-day price feeds**: Daily ZEC/USD exchange rate data for currency conversion
- **Token metadata**: ZEC token information including decimal precision (8 decimals) for proper unit conversion

## 3. Step-by-step calculation

### Component A: Input value lookup table creation

- **Purpose**: Build a reference table that maps transaction outputs to their values, enabling input value resolution for fee calculations
- **Logic**: Extract all transaction outputs from Zcash blockchain data, creating records with `txid`, output index (`n`), and `valueZat` amounts. Each output becomes a potential input for future transactions. Filter by processing timeframe and partition data monthly for efficient lookups. Generate surrogate keys using `txid` and output index combinations for unique identification.
- **Key fields**: `txid` for transaction identification, `output_index` for UTXO position, `output_value` in zatoshis for monetary amounts

### Component B: Fee calculation per transaction

- **Purpose**: Calculate the actual fee paid for each non-coinbase transaction using UTXO accounting principles
- **Logic**: Start with all non-coinbase transactions (exclude mining rewards). For each transaction, resolve input values by joining with the lookup table using `txid` and output index matches. Sum all input values to get `total_input_value_zat`. Sum all output values within the same transaction to get `total_output_value_zat`. Apply the Zcash fee formula by summing the net value changes across all supported pools: fee = (total_inputs - total_outputs) + Sapling value balance + Orchard value balance + Sprout value balance, where each pool's value balance represents the value leaving the pool (positive when value moves from shielded to transparent). Sapling balance comes from `value_balance_zat`, Orchard from `orchard.valueBalanceZat`, and Sprout from the sum of `vpub_newZat - vpub_oldZat` across the transaction's JoinSplits. Pure shielded transactions with no transparent legs are retained via outer joins so their fees are not silently dropped.
- **Key fields**: `block_timestamp` for timing, `txid` for transaction identity, `fee_zat` as the calculated fee amount in zatoshis, `value_balance_zat` for shielded transaction adjustments

### Component C: Daily aggregation and unit conversion

- **Purpose**: Aggregate individual transaction fees into daily totals and convert from zatoshis to standard ZEC units
- **Logic**: Group transactions by daily timestamps using `timestamp_trunc(block_timestamp, day)`. Sum all positive fee values (negative fees are excluded as invalid). Convert from zatoshis to ZEC by dividing by 100,000,000 (1e8). Set metadata fields including chain identifier as 'zcash', token address as 'native', and timestamp grain as 'day'.
- **Key fields**: `timestamp` for daily boundaries, `fees_native` as daily fee totals in ZEC

### Final aggregation

- **Combining components**: The daily ZEC fee totals flow directly into currency conversion without additional aggregation
- **Currency conversion**: Apply end-of-day ZEC/USD exchange rates using the `convert_to_usd_and_correct_decimals` macro, which handles decimal precision and price lookup automatically
- **Time aggregation**: Data is pre-aggregated to daily boundaries during the fee calculation phase
- **Final calculation**: The supply-side fees metric equals the USD-converted daily fee totals, representing the total value captured by miners from transaction fees. The `finalize_metric_fees_supply_side` macro ensures proper schema structure and fills any data gaps according to the specified strategy.

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

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

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