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 Supply-side fees Methodology

## 1. Overview

ZyberSwap supply side fees represent the portion of trading fees that goes to liquidity providers rather than the protocol. This metric is calculated by multiplying daily trading volume by the difference between total trading fees and protocol fees (fee_tier - protocol_fee_tier). ZyberSwap operates both v2 and v3 versions of their DEX on Arbitrum, each with different fee structures - v2 uses fixed fee rates while v3 employs dynamic fees that can be adjusted per pool.

## 2. Data sources

The calculation relies on several types of raw blockchain and external data:

- **Swap events**: Parsed `Pair_Swap_event` logs from ZyberSwap v2 contracts and `AlgebraPool_Swap_event` logs from ZyberSwap v3 contracts on Arbitrum, containing token amounts exchanged in each trade
- **Fee configuration events**: Parsed `AlgebraPool_Fee_event` logs from ZyberSwap v3 contracts capturing dynamic fee tier changes, and `AlgebraPool_CommunityFee_event` logs capturing protocol fee ratio updates
- **Pool creation events**: Parsed `SwapDeployer_NewSwapPool_event` and `Factory_PairCreated_event` logs from ZyberSwap v2 contracts, plus `AlgebraFactory_Pool_event` logs from v3 contracts, establishing trading pair relationships and token configurations
- **Transaction records**: Arbitrum transaction data to map contract addresses to actual user addresses
- **Token metadata**: Token registry data providing token symbols and decimal specifications for amount normalization
- **Price feeds**: End-of-day token price feeds for USD conversion of trading volumes

## 3. Step-by-step calculation

### Component A: Trade event extraction
- **Purpose**: Collect all swap transactions from ZyberSwap v2 and v3 contracts
- **Logic**: Extract swap events from both protocol versions on Arbitrum. For v2, parse `Pair_Swap_event` logs and calculate net token amounts using `amount0In - amount0Out` and `amount1In - amount1Out`. For v3, parse `AlgebraPool_Swap_event` logs and use `amount0` and `amount1` fields directly. Join with Arbitrum transaction records to map contract user addresses (`sender` field) to actual user addresses (`from_address`). Filter events to start from January 23, 2023.
- **Key fields**: `block_timestamp`, `transaction_hash`, `account_address` (pool address), `token0_amount`, `token1_amount`, `user_address`

### Component B: Fee tier determination
- **Purpose**: Determine the trading fee percentage applied to each swap
- **Logic**: For ZyberSwap v3 swaps, retrieve dynamic fee tiers by joining swap events with the most recent `AlgebraPool_Fee_event` for each pool at the time of the trade. The `fee` field is divided by 10^6 to convert from basis points to percentage. For ZyberSwap v2 swaps, apply a hardcoded fee tier of 0.25% (0.0025) as v2 uses fixed fees.
- **Key fields**: `fee_tier` representing the total trading fee percentage

### Component C: Protocol fee calculation  
- **Purpose**: Calculate the portion of trading fees that goes to the protocol rather than liquidity providers
- **Logic**: For v3 swaps, retrieve protocol fee ratios from `AlgebraPool_CommunityFee_event` logs by matching pool addresses and taking the most recent ratio before each trade date. Calculate protocol fees by multiplying the fee tier by the maximum of `communityFee0New` and `communityFee1New` (both divided by 10^3 to convert from basis points). Apply forward-filling to handle missing protocol fee data. For v2 swaps, apply a hardcoded protocol fee of 0.10% (0.001).
- **Key fields**: `protocol_fee_tier` representing the protocol's portion of trading fees

### Component D: Trading pair metadata
- **Purpose**: Establish token pair relationships and obtain token specifications
- **Logic**: Parse pool creation events from both v2 and v3 versions to establish trading pairs. For v2, extract pairs from `SwapDeployer_NewSwapPool_event` (handling multi-token pools by creating all possible pairs) and `Factory_PairCreated_event`. For v3, use `AlgebraFactory_Pool_event`. Join with token metadata to obtain decimal specifications and symbols for each token in the pair. Create descriptive pair names by concatenating token symbols.
- **Key fields**: `account_address` (pool), `token0_address`, `token1_address`, `token0_decimals`, `token1_decimals`, `account_name`

### Component E: Volume calculation with price protection
- **Purpose**: Calculate USD trading volume while preventing price manipulation
- **Logic**: Join swap events with trading pair metadata to get token decimal specifications. Normalize token amounts by dividing absolute values by 10^decimals for each token. Join with end-of-day price feeds to convert both tokens to USD values. Apply price manipulation protection by taking the minimum USD value between the two tokens in each swap (`least(token0_amount * price0_usd, token1_amount * price1_usd)`). Aggregate volumes daily by summing normalized USD amounts across all swaps.
- **Key fields**: `trading_volume` representing daily USD trading volume per pool

### Final aggregation
- **Combining components**: Join daily trading volumes with their corresponding fee tiers and protocol fee tiers, maintaining pool-level granularity
- **Currency conversion**: USD conversion occurs at the individual swap level using end-of-day price feeds, with minimum value logic applied between token pairs to prevent manipulation
- **Time aggregation**: All data is aggregated to daily boundaries using timestamp truncation, with forward-filling applied to fee configurations
- **Final calculation**: Supply side fees are calculated as `trading_volume * (fee_tier - protocol_fee_tier)`, representing the portion of trading fees that flows to liquidity providers rather than the protocol

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

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

ZyberswapZYB

Supply-side fees

Supply-side fees

Competitive landscape