Cost of revenue

Overview

Cost of revenue measures the expenses a project incurs when outsourcing a core part of its business to third-party service providers. These payments are made after the project has collected its revenue, as determined by its take rate. Examples include node operator payments for liquid staking protocols or DA fees for L2 blockchains.

Data sources

• Smart contract events and program instructions capturing service fee payments and reward distributions
• Off-chain settlement documentation for inter-protocol agreements
• Token price feeds for USD conversion and asset metadata for decimal normalization

Common calculation approaches

Operational payout tracking

Reward distributions and partner payouts are identified from token movements between specific protocol addresses and service providers. For example, staking rewards and partner payments are aggregated from ERC-20 Transfer events from Ethena.

Infrastructure and node operator compensation

Compensation for providing essential network services is derived from specialized smart contract events or token mints. For instance, node operator payments are derived from Transfer events and reward distribution logs from Lido Finance.

Network settlement and data availability costs

Operational expenses for Layer 2 blockchains are determined by the costs of posting transaction batches and data to a base layer. For projects like Base, settlement costs are calculated from gas usage and fee components of settlement transactions on Ethereum.

Revenue sharing and borrowing settlements

Costs arising from infrastructure partnerships or liquidity borrowing are derived from settlement records or predefined sharing rates applied to protocol activity. Interest expenses are identified from monthly settlement data from Spark, while infrastructure costs are allocated from Operate program instructions on Solana for Jupiter Lend.

Note: The calculation approaches and protocol examples above are representative patterns. Individual protocol implementations may vary.