What is Ethereum?

Ethereum is a decentralized, open-source blockchain with smart contract functionality. Ether is the native cryptocurrency of the platform. Among cryptocurrencies, ether is second only to bitcoin in market capitalization. Ethereum was conceived in 2013 by programmer Vitalik Buterin.

What is Arbitrum?

Arbitrum blockchain uses rollups to combine multiple transactions into one, lowering on-chain transaction costs and boosting scalability. It is a type of Layer 2 Ethereum scaling solution. The original Off-chain Labs team invented the Arbitrum protocol and developed Arbitrum L2 Rollups.

What is Avalanche?

Avalanche is a platform for creating custom blockchain networks and decentralized applications (dApps). Created by Ava Labs, the Avalanche crypto platform is one of many projects seeking to unseat Ethereum as the blockchain ecosystem's most widely utilized smart contract platform.

What is Binance Smart Chain?

Binance Smart Chain (BSC) was first introduced to the world by Binance in 2019. And from that point on, Binance has made sure to provide the fastest and most decentralized trading. Binance Smart Chain provides a full-featured decentralized development environment built on new Blockchain technology training.

What is Optimism?

Optimism is a Layer 2 scaling solution for Ethereum that can support all of Ethereum's Dapps. Instead of running all computation and data on the Ethereum network, Optimism puts all transaction data on-chain and runs computation off-chain, increasing Ethereum's transactions per second and decreasing transaction fees.

What is Polygon?

Polygon is a blockchain platform that enables blockchain networks to connect and scale. It aims to create a multi-chain blockchain ecosystem compatible with Ethereum. As with Ethereum, it uses a proof-of-stake consensus mechanism for processing transactions on-chain while deriving its security from Ethereum.

Ethereum Virtual Machine (EVM)

The Ethereum virtual machine (EVM) is often referred to as “the heart of Ethereum” — which is exactly what it is. Just as the heart pumps blood that distributes oxygen and nutrients throughout the body, an EVM grants developers the ability to create smart contracts and DApps in the Solidity programming language. It’s responsible for the majority of DApps being created today, which is what distinguishes it from Bitcoin and other distributed ledgers. In this article, we’ll dive headfirst into Ethereum virtual machines and break down what they are, how they work and their role in DApp development and the advancement of Web 3.0.

Conceptualized in 2013 by programmer Vitalik Buterin, the Ethereum network owes its phenomenal success as the preferred blockchain for DApp developers to the Ethereum Virtual Machine (EVM) that was designed by Gavin Wood during his tenure at Ethereum. Written in C++ and using the LLVM Project compiler, EVM is a special state machine that operates continuously and whose immutable operations determine the state of each block in the Ethereum blockchain. 

The EVM not only governs what nodes can or cannot do to the distributed ledger maintained by the Ethereum blockchain but also defines the specific rules of changing state from block to block. The latter functionality is what enables the smart contract functionality that Ethereum has come to be known for.

To understand what an Ethereum Virtual Machine does, one needs to look at each of the different functions it serves in ensuring the smooth operation of the Ethereum network. For every input that it receives, the EVM produces an output that is deterministic in nature and follows a mathematical function in the simplest sense. 

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Methodology

In this dashboard, I am going to analyze the users’ behavior on Ethereum and 5 other EVM Chains (Arbitrum, Avalanche, Binance Smart Chain, Optimism and Polygon) around new year holidays and compare the activity on these days vs days after and before that.

For this purpose, I am going to firstly analyze the price-change of these ecosystems’ native tokens (ETH, AVAX, BNB, OP & MATIC) during holidays and days before and after them.

Then, I am going to analyze the overall activity on chain on these days like number of transactions, active users, new first-time users and transactions fees.

Then, I am going to analyze transfers within the chain and also transfers to/from centralized exchanges.

Then, I am going to analyze NFT trading activity on these days,

Then, I am going to analyze staking/unstaking activity on these days.

Then, I am going to analyze the swap activity on these chains around new year.

Then, I am going to analyze the top popular destination of transactions by users within these timespan.

And Then, I am going to analyze the balance change of these Ethereum wallets during the holidays and before and after that.

In this dashboard, I have analyzed data from 1 week before holiday beginning (17th December 2022) till today (6th January 2023). I have highlighted Dec. 24 2022 - Jan. 3 2023 as “Holidays” and the other days are known as “Other Days”.

Since we are comparing 6 different chains with various currencies, I have used the $USD value of transactions in order to compare them correctly in terms of volume.

The main purpose of this bounty is to realize how users are acting with their cash (received as gift or etc.) in these days, how are they using their cryptocurrencies in these 6 mentioned chains and also how these blockchains have performed during Holidays and new year.

(the analyzed volume are estimated values and mainly are calculated by the transacction activity of the main native token of the chain. because in some chains there is not any price table and also the decimals value of all tokens are different)

Tokens’ Price

In the 2 above charts, we can almost see a similar behavior of all tokens over time.

As we see, since the first days till ~27th December 2022, the tokens’ prices have experienced growth or held their value over time but after 27th December (3rd day of the Holidays and 3days before the Beginninng of th new year) almost all tokens have lost a percentage of their value and experienced decline in their price line. again after the beginning of the new year, we can kinda see increasing trend line of these tokens’ price as time goes on.

So, maybe we can say that drop price during last days of the year can be because ppl were selling their tokens in order to get ready for holidays and new year expenses and then after holidays and the start of the new year, they have began to invest in cryptocurrencies again with their left money from Holidays.

Transactions and Wallets Overview

Based on the above charts, the number of transactions and also active users on these chains during Holidays have not change significantly (other non-holiday days have slightly more number of transactions and active users). but the interesting thing is that we can see high number of new first-time wallets that have registered on these networks during Holidays and maybe this is because they were doing their first-ever transactions on chains via their received gifts during Holidays and new year. the highest spike of new users have achieved on 31st Decemebr, the last day of the year 2022.

in terms of transactions fees, we can see significant decline in paid fee for transactions during Holidays (despite almost constant number of transactions within these days). So, maybe users during these days were mainly doing some regular transactions that do not need high fees to be exectued. As we see, the average transactions fees has also slightly decreased during Holidays. So, the only metric that Holidays is leading on that is the number of new first-time wallets and in other terms (number of transactions, active users & paid fee) Other non-holiday days have the lead.

On the left chart, I have analyzed the average daily number of transactions done by an average user within these chains.

As we see, in majority of chains (Ethereum, Polygon, Arbitrum, BSC & Avalanche) the activity of users have increased during Holidays and they have performed more daily transactions compared to the days before and after Holidays.

But in Optimism chain, we can see decreasing activity of average users during Holidays compared to the days before and after that.

Tokens Transfers Overview

On the above and left charts, we can see there is almost a steady trend line of number of transfers within these chains during Holidays vs other days. But, the intersting thing is that the volume of tokens' transfers within Holidays has significantly decreased and again after the holidays, the transfers volume has increased significantly (with the highest spike on the first day after the Holidays). We can also see that average transfers' volume has also decreased during Holidays compared to the days before and after them.

Transfers To/From Centralized Exchanges

In this part, we can say that users who are sending their assets to the Centralized Exchanges are willing to sell their asset (receive Cash in order to spend on holidays), on the other hand, users who are sending their asset from Centralized Exchanges to their wallets, have bought some cryptos with their received cashes/gifts.

Similar to the previous part (tokens’ transfers within chains), we can also see almost constant trend line of number of transfers to/from CEXs during Holidays but on the other hand, the volume of transfers to/from CEXs has decreased significantly during Holidays and again increased after Holidays.

Totally, we can see that number and especially volume of transfers TO CEXs (selling tokens) is more than transfers from CEXs (buying tokens). The interesting thing is that the volume and number of transfers FROM CEXs has increased slightly during Holidays and this can be because maybe users have bough some new tokens on Holidays (via their received gifts/etc) and transfered out them from CEXs.

NFT Trading Activity

In the NFT ecosystem, we do not see a significant change during Holidays compared to the days before and after that. the number of NFT trading activities (and also number of active traders) has slightly increased during Holidays but on the other hand, we can see less volume of NFT trading during Holidays compared to the other days.

However, we can see the highest activity (in both terms of number and volume) of NFT sales during the last days of the year 2022 and especially on 27 - 30 December. maybe users were trying to trade their NFTs in the last year and earn income to spend them in Holidays and New Year or maybe they were trying to some new-released NFTs upon holidays and new year.

Also, the median volume of sales (that can be related to the tokens’ prices) did not significantly change during Holidays and remained low.

Staking Activity

On the above and left charts, we can see the staking activities on these chains during Holidays and days after and before them.

As we see, the number and also volume of staking activities within other non-holidays is more than holidays (despite that highest spike of stakes on 27th December and also high average volume of stakes during Holidays).

During holidays, the volume of staking activities has decreased significantly especially during first days but as time goes on (that also continued after Holidays ending), there was more and more volume of stake activities on these chains over time. but on the other hand, we can see decreased trend line of number of stakes (and unstakes) over time.

The intersting thing is that the highest number of unstakes have achieved almost 2 days before the beginning of the holidays and maybe this is because users were trying to unstake their assets and spend them in holidays and new year.

Swap Activity

Similar to the transfers activity (that we have seen in previous parts), the swapping activity on all chains has kinda decreased (especially in terms of volume) during Holidays compared to the days before and after them.

As we see, in all chains, the volume and also number of swaps has decreased on Holidays and this means users were busy doing some other actions rather than swapping their tokens via dex protocols.

Stablecoins Swaps

In this part, We can assume that users who are swapping their assets to stablecoins are selling their tokens and on the other hand, the swaps from stablecoins to other assets are assumed as buying new tokens.

Also, the stablecoins that I have analyzed for this part are most popular stablecoins such as USDC, USDT, DAI, FRAX, BUSD and TUSD.

Well, the results are interesting. As we see, the number of stablecoin swap activity during Holidays has decreased slightly compared to the other days. but on the other hand and in terms of volume, we can see way higher stablecoin swap activity during Holidays. and the majority of these activities is because swaps to stablecoins.

So, this means that users are selling their asset (exchanging them to stablecoins) in order to spend them on Holiday (gifts/travels/etc).

Moreover, we can see a huge high spike of swaps volume to stablecoins on the 30th December (the last days of the year 2022) and maybe this is because users were trying to get ready for new year.

Totally, we can see some increasing share of swaps TO stablecoins since 23rd December till 1 January but again after this date and the beginning of the new year, we can again see increasing share of swaps FROM stablecoins (buying new assets) in swap programs.

Top Destinations of Users

In this part, firstly I have analyzed the share of destinations of all transactions within chains by the destination’s labe_typ.

Then, I have analyzed the behavior of users via their received tokens during Holidays in order to understand how and where they have spent these new-received tokens (can be called Gifts!).

As we see on the left charts, Layer2, tokens, DEXs and Dapps are the most popular destination of users during Holidays (in both terms of number of users and transactions).

Moreover, we can see kinda increasing share of Dapps and Tokens and also DeFi programs during Holidays (compared to the days before and after) in terms of number of transactions.

In terms of number of users, we can significantly see increasing share of Tokens destinations during the holidays.

And on the left charts, we can see the daily share of transactions’ destinations during Holidays and before and after this timespan.

Overally, the number of transactions and also active users has slightly decreased over time especially with the lowest activity on 1st January 2023.

Wallets’ Balance

And on the left charts, we can see the evolution of USD wallet balance of users over time.

As we see, during Holidays (and also days after that), the balance of wallets has slightly decreased meaning that users were spending their cryptos on Holidays/new years for gifts/tokens/travel/etc.

Also based on the right average daily chart, we can obviously see that the average daily balance of wallets during Holidays is less than other days.

Summary and Conclusion

Based on the above analysis on Ethereum, Avalanche, Arbitrum, Binance Smart Chain, Polygon and Optimism networks since 17th December 2022:

• All tokens’ price has decreased during the last days of the december (before holidays beginning) but began to recover their lost value after holidays. So, this can be concluded that users were selling their cryptos in order to get ready for holidays/new year expenses.
• The number of transactions and also active wallets during Holidays did not change significantly and there was slightly less activity on chains during Holidays. But the interesting thing was that there were high spike of new registering wallets on networks during Holidays in almost all chains.
• The total paid volume for transactions fees and also the average transactions fees has significantly decreased during Holidays and this can be concluded users during holidays were doing some regular low-cost transactions.
• In all chains except Optimism, the activity of an average chain’s user has increased during Holidays and he/she has performed more daily transactions compared to the days before and after Holidays.
• There was not significant change of number of transfers on these chains during Holidays but the interesting thing was that volume of transfers (within chains and also to/from CEXs) have significantly decreased during Holidays and began to recover again after the Holidays. Also, we have seen that number and especially volume of transfers TO CEXs (selling tokens) was more than transfers from CEXs (buying tokens). The interesting thing was that the volume and number of transfers FROM CEXs has increased slightly during Holidays and this can be because maybe users have bough some new tokens on Holidays (via their received gifts/etc) and transfered out them from CEXs.
• the NFT ecosystem was not heavily affected by Holidays and there was not significant change of activities during Holidays. However, we have seen some high NFT trading activities within the last days of the year.
• The staking activities during Holidays have slightly decreased compared to the days before and after them but there was high spike of stake transactions and volume during the last days of the year. Also, we have seen that the unstaking activity has signifincatly increased during Holidays (last days of the year) and this can be mainly because users were trying to unstake their asset and spend them in Holidays and New Year.
• Similar to the transfers activity, the swapping activity on all chains has kinda decreased (especially in terms of volume) during Holidays compared to the days before and after them. in all chains, the volume and also number of swaps has decreased on Holidays and this means users were busy doing some other actions rather than swapping their tokens via dex protocols.
• The interesting was that ther was way higher stablecoin swap activity during Holidays. and the majority of these activities were because swaps to stablecoins. this means users were trying to exchange their asset for stablecoins (~selling them).
• Layer2, Dapps, Defi and DEXs were the most popular destination of users’ transactions during Holidays.
• Most number of users who have received funds during Holidays, spend their received assets on DEXs such as Uniswap, TraderJoe, Sushiswap, Velodrome, etc, or transferred them to Metamask and other DeFi protocols, Some of them also transfered their assets to CEXs (Binance, Coinbase, etc).

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Popular Destination of Users Via Their Received Tokens During Holidays

And on the above charts, we can see top destination of users via their received tokens during Holidays. this means that these destnations are the ones where the User has spend his/her received token (~gift) during Holidays.