How DeFi Protocols Make Money and Who Gets the Fees

A DeFi protocol makes money by keeping a slice of a payment that one group of users makes to another, and for most protocols the slice is small. Between January and July 2026 traders paid Uniswap $297.9 million in swap fees. The protocol kept $28.2 million, about 9.5%, according to figures reported by Toobit. The rest went to the liquidity providers whose capital the trades ran against.

That ratio is the thing worth carrying around. The yield a depositor is offered and the revenue a protocol earns come out of the same payment, so every point the protocol takes is a point the depositor does not get. Which slice goes where is set by parameters, and those parameters are changed by governance vote.

The accounting most dashboards use comes from DefiLlama's data definitions. Fees are everything users pay. Supply-side revenue is the part paid to whoever supplies the capital: liquidity providers, lenders, stakers, node operators. Revenue is what remains: fees minus supply-side revenue. Revenue then splits again, into what the protocol retains and token holder revenue, the part returned through buybacks, burns or staking distributions. Token emissions are not counted as fees at all.

The slice is taken in different places depending on the kind of protocol:

• DEX swap fees. Uniswap v2 charges 0.30% per swap. Until December 28, 2025 all of it went to liquidity providers; the UNIfication vote changed that to 0.25% for providers and 0.05% for the protocol. On v3 the protocol takes one-quarter of provider fees on the 0.01% and 0.05% tiers and one-sixth on the 0.30% and 1% tiers.
• Borrow interest. DefiLlama counts all interest borrowers pay as fees, not only the protocol's cut. How much a lending market keeps is set by a parameter per market. Curve's documentation states that 100% of crvUSD borrow interest is classed as admin fees taken by the protocol, though the page flags itself as partly outdated. Aave's current reserve factors and liquidation penalties are not in the sources this page draws on, and no figure is given for them here.
• Stablecoin spread. An issuer holding yield-bearing collateral keeps the difference between what the collateral earns and what the stablecoin pays holders, a model a September 2026 report attributes to Sky's own documentation. Sky's current stability fee and savings rate are not in those sources either.
• Staking cut. Staking rewards passed to depositors count as supply-side revenue; whatever a liquid staking protocol retains is its revenue. Lido's current percentage is not documented in this page's sources. The scale is not in doubt: Lido and Binance staked ETH together held $45.07 billion on September 14, 2026.

Uniswap burns it. For most of its life Uniswap reported large fees and no protocol revenue; DL News cites $542 million in a year, all of it paid to liquidity providers. The fee switch passed by 125,342,017 UNI to 742, against a 40 million quorum. Captured fees go to a contract called TokenJar and can leave only through a burn contract, Firepit. Holders receive a smaller supply, not cash. Estimates of the protocol's share disagree: about 17% of swap fees in one analysis, roughly one-sixth in another, 9.5% in the realized Toobit figures. The gap comes from the tier mix and from which pools the switch covered at the time. The original forum proposal put initial coverage at 80 to 95% of Ethereum mainnet provider fees, and a July 2026 proposal extended it to v4 pools on seven networks.

Curve pays lockers. Curve's fees go to veCRV holders, people who have locked CRV for voting power, not to anyone who merely holds the token. In one volatile week in May, Curve took in over $15 million in fees and counted $7.5 million as revenue.

Aave buys back. One report puts Aave's annualized revenue at about $402 million and describes a buyback removing roughly 292 AAVE a day since June 27, 2026. The same report notes the annual buyback budget was cut from $50 million to $30 million in March 2026. A month later the "Aave Will Win" proposal passed, and it now targets roughly $50 million a year in buybacks, paced at $1 million a week, according to Spark. The size of the slice passed to holders is a budget line, and budget lines move.

The strongest objection is that this is changing fast. Holder distributions rose from about 5% of DeFi revenue before 2025 to about 15% in 2026, by one independent estimate. That is a genuine shift, and it cuts the other way from the Uniswap history above. It still leaves about 85% going to liquidity providers, treasuries or companies, and a study of 1,244 protocols found only about 20 had distributed more than $10 million to holders. The slice is growing. It remains a slice.

A large fee number describes activity, not profit; pre-switch Uniswap proved the two can sit a whole balance sheet apart. And a burn or buyback reduces supply without paying anyone. Aave's 2025 revenue is reported as $907 million under a broad definition and about $140 million under a narrow one, so any revenue figure is worth checking against the definition behind it.

The yield on offer is supply-side revenue. It is paid by traders, borrowers or stakers, minus whatever the protocol keeps, and the size of that keep is a live parameter. Uniswap liquidity providers on v2 went from 0.30% to 0.25% per swap on the strength of one vote. Anyone comparing pools across the main types of DeFi protocol is comparing the same payment cut at different points.

Two checks follow. First, read the fee and revenue lines separately on DefiLlama; the difference between them is roughly what suppliers are paid. Second, find out who approves parameter changes, because the people who vote on the protocol's share are usually holders of a token that benefits from raising it, and depositors are rarely in the room when they do.