ALGO Transaction Payment Size
Q43. Let’s look at the quantities of ALGOs being sent in transactions since January 1st 2022 to see if we see any upwards or downwards trends. Group the transactions(algorand.payment_transactions) by size 0-10ALGOs, 10-100ALGOs,100-1000ALGOS, 1,000-10,000ALGOs and 10,000+ ALGOs. Count the number of transaction in each size and chart them by day from January 1st 2022 to current. Do we see any trends of increasing or decreasing payment sizes? What might this indicate for the Algorand network?
Introduction
Algorand is a pure proof os stake (PoS) blockchain with low fees with a consensus mechanism based on PoS and Byzantine agreement which is chosen for scalability. With a blocktime of around 4.5 seconds and its low fees, it is seen as a very promising project. But how are the payment transactions in the blockchain's native token, ALGO, evolving? Let's find out some patterns in the data!
Methodology
My first approach was to query the algorand.payment_transaction
table and count the number of transactions with count(tx_id) as number_payments
and adding up the total amount transacted with sum(amount) as total_value_transacted
, using a case to group the transactions by size as described in the bounty instructions.
Since the visualization of the data is a bit difficult due to the different ranges of the size types, I created a second query with CTE, where for each size a separate table calculates the number of payments and total amount transacted, to join all the data and allow for comparison of individual sizes.
For the two analyses, I analysed transactions with amount bigger than 0 ALGO since January 1st. All volumes are in ALGO.
Results
Single Query
Figures 1a and 1b show the number of transactions per size, in absolute value and normalized.
Transactions from 0-10 ALGO have have seen a considerable decrease since the first week of the year where a max over 560k transactions were made. Last seven days it was below 90k for the same size.
Sizes 10-100 and 100-1k see a significant increase (from around 10k and 7k to double those levels respectively) after January 19th, maintaining those levels until end of February. March has seen values below this increased range and again at 14k and 22k on March 18th.
All sizes see a decrease between January 6th and January 19th.
CTE query
Figure 3 shows the number of transactions on a log scale.
The general trends are easierly identified:
- Size 1 (0-10 ALGO) transactions are declining steadily since January 1st, from 500k to below 100k.
- Size 2 (10-100 ALGO) and Size 3 (100-1k ALGO) suffered a U-shape decline and recovery in January and have been declining slighty since the recovery.
- Size 4 (1k-10k ALGO) saw a V-shape decline and recovery in January all inside the band between 2000-5000.
- Size 5 (+10k ALGO) levels between 500-1000 tx are maintained except for January 22nd and March 12th.
Figures 2a and 2b show the total value transacted per size, in absolute value and normalized.
There is a massive peak of over 1B transacted overall, which size +10k accounts for over 98% of all value transacted. This peak happened in the days previous to the January decrease. After this decrease, there is another volume peak on January 20th and from there on, total value transacted has been declining significantly.
Figure 4 shows the total amount transacted on a log scale.
The general trends are easierly identified:
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Despite high peak on January 5th and low peak on March 13th, Size 5 (+10k ALGO) transacted value remains between 50-100M.
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Size 4 (1k-10k ALGO) remains between 5-20M transacted
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Size 3 (100-1k ALGO) recovered after the January fall to over 7M but has lost this level and is currently below 5M. January lows were 2M.
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Size 2 (10-100 ALGO) has a similar profile as size 3, January lows of 500k, recoveredto almost 1.5M and struggling now between 500k-900k.
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Size 5 (0-10 ALGO) is at the series absolute low, with only 50k compared to the max of 200k before the depression in January, which reached 100k.
Conclusions
The smaller transactions between 0-10 ALGO have been diminish both in number and total value since January first.
The bigger transactions of 1k-10k and +10k ALGO have been maintaining or slightly increasing the metrics.
This can mean that Algorand transactions are not being used as smaller payment in favour of other blockchains, while smart money keeps using to obtain returns on their bags. The negative trend in number of transactions and value transacted of the network is midly worrying. It could be compensated with transactions in other Algorand Standard Assets (ASAs).
The January depression was caused by hack on Tinyman, when a malicious actor exploited an error in the smart contract which allowed him to recieved double amounts of one token in a liquidity pool instead of the pair.
Figure 5 shows the correlation between number of transactions and total value per size, with both axis as log scale.It shows how the sizes are limited in relatively precise bands, with the exception of size 5 due to its open upper limit.