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

Zyberswap is a non-custodial exchange protocol built on Arbitrum. Zyberswap was founded by anonymous team and launched in 2023.

ZYB tokenholders own and govern the protocol. They currently take a cut of the total trading fees paid by traders (revenue).

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Zyberswap

# Zyberswap Earnings Methodology

## 1. Overview

Zyberswap earnings represents the protocol's net profit calculated as revenue minus expenses on a daily basis. Revenue is generated from protocol fees collected on trading activity across Zyberswap's v2 and v3 automated market maker exchanges on Arbitrum. Expenses consist entirely of ZYB token incentives paid to liquidity providers. This metric measures the protocol's financial performance and sustainability by showing whether protocol fee collection exceeds liquidity mining costs.

## 2. Data sources

- **Arbitrum blockchain events**: Parsed `Pair_Swap_event` logs from Zyberswap v2 pairs and `AlgebraPool_Swap_event` logs from Zyberswap v3 pools capturing all trading activity
- **Protocol fee events**: `AlgebraPool_CommunityFee_event` logs tracking dynamic protocol fee rate changes on v3 pools and `AlgebraPool_Fee_event` logs for trading fee updates
- **Liquidity incentive events**: `EternalFarming_RewardClaimed_event` logs from v3 eternal farming contracts and ZYB token transfer events from the ZyberChef contract for v2 rewards
- **Trading pair metadata**: Pool creation events from `SwapDeployer_NewSwapPool_event` (v2), `Factory_PairCreated_event` (v2), and `AlgebraFactory_Pool_event` (v3) to map trading pairs
- **Transaction data**: Arbitrum transaction records to identify end users behind contract interactions
- **External data**: End-of-day token price feeds for USD conversion and token metadata including decimals and symbols
- **Protocol configuration**: Hardcoded contract addresses for incentive distribution accounts (Ethernal Farming: `0x40f5af7171b35963dba9cd9952d3f11f5e32dd30`, ZyberChef: `0x9ba666165867e916ee7ed3a3ae6c19415c2fbddd`) and ZYB token address (`0x3b475f6f2f41853706afc9fa6a6b8c5df1a2724c`)

## 3. Step-by-step calculation

### Component A: Revenue calculation
- **Purpose**: Calculate daily protocol fee revenue from trading activity across v2 and v3 exchanges
- **Logic**: Extract swap events from both Zyberswap versions on Arbitrum. For v2, use `Pair_Swap_event` logs with `amount0In`, `amount0Out`, `amount1In`, and `amount1Out` fields to calculate net token amounts. For v3, use `AlgebraPool_Swap_event` logs with `amount0` and `amount1` fields directly. Join trading pairs dimension to get token addresses, decimals, and pair names. Apply decimal corrections to convert raw token amounts to actual quantities. For fee rates, v2 uses hardcoded 0.25% trading fee and 0.10% protocol fee. V3 uses dynamic rates from fee update events, with protocol fees calculated as trading fee multiplied by community fee percentage. Convert token amounts to USD using end-of-day price feeds, taking the minimum USD value between token0 and token1 amounts to prevent price manipulation attacks. Multiply daily trading volumes by protocol fee rates to get revenue
- **Key fields**: `amount0In`, `amount0Out`, `amount1In`, `amount1Out` (v2), `amount0`, `amount1` (v3), `fee`, `communityFee0New`, `communityFee1New`, `sender`, transaction originator addresses

### Component B: Expenses calculation  
- **Purpose**: Calculate daily expenses from ZYB token incentives paid to liquidity providers
- **Logic**: Collect incentive payments from two sources. For v3, extract `EternalFarming_RewardClaimed_event` logs where `rewardAddress` equals ZYB token address, using `reward` field for amounts. For v2, extract token transfer events where `from_address` is the ZyberChef contract and `token_address` is ZYB token, using `value` field for amounts. Join with incentive accounts dimension to classify payment sources. Apply decimal corrections using ZYB token metadata. Convert amounts to USD using end-of-day price feeds for ZYB token. Aggregate daily totals across all incentive sources
- **Key fields**: `reward` (v3 farming), `value` (v2 transfers), `rewardAddress`, `from_address`, `token_address`

### Component C: Trading pair identification
- **Purpose**: Map swap events to trading pairs with token metadata for decimal corrections
- **Logic**: Build comprehensive trading pair registry from pool creation events across both versions. For v2, process `SwapDeployer_NewSwapPool_event` for multi-token pools and `Factory_PairCreated_event` for standard pairs. For v3, use `AlgebraFactory_Pool_event` logs. Extract pool addresses, token0 and token1 addresses, and create bidirectional mappings for all token combinations. Join with token metadata to get decimals and symbols for each token. Generate pair names by concatenating token symbols
- **Key fields**: `swapAddress`, `pair`, `pool`, `pooledTokens`, `token0`, `token1`, token addresses and decimals

### Final aggregation
- **Combining components**: Revenue and expenses are calculated independently and aggregated daily. Revenue comes from multiplying trading volumes by protocol fee percentages. Expenses come from summing USD values of all ZYB token incentive payments
- **Currency conversion**: All amounts converted to USD using end-of-day token price feeds. Trading volumes use minimum USD value between token pairs to prevent manipulation. ZYB incentives converted directly using ZYB/USD prices
- **Time aggregation**: All data aggregated to daily boundaries using timestamp truncation to day level. Missing days handled with zero-fill strategy
- **Final calculation**: Daily earnings equals daily protocol fee revenue minus daily token incentive expenses. Formula: Earnings = (Trading Volume × Protocol Fee Rate) - Token Incentives in USD. Negative earnings indicate the protocol paid more in incentives than it collected in fees

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

Net profit (also profits, net income, profitability) — revenue remaining after subtracting expenses.

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