What should I expect from this report

The answer to the old crypto question. ¿What came first, the price movement or the trading volume?

The token in this particular case is OP token, the governance token for the Ethereum Layer 2 solution, Optimism.

Method

• For this report, Flipside’s data repository was used.
• The market to evaluate all those trades will be Velodrome. This will be touched on the report but essentially the reason being that Velodrome currently hold the most trades inside Optimism from the three exchanges that currently are specifically digested by Flipside.

(This does not mean that there are not other markets inside its database, only that transactions for this markets are easily queryable (? )

From highs to lows, to highs to mediums

Thats where we are now a during the full force of the bear market.

OP token price has come to what the market has priced as its corresponding value in all this crypto madness.

But does this movement propitiate trading volume?

YEssnt.

Well, this wont be a particularly long case

Except for this box.

As seen in both charts, price movement does correlate to some degree. Actually, enough to let us talk about how one influence the other.

At the start of OP price decrease, there wasnt a particularly high response both in USD volume going out from OP, or swapping volume.

There was though when price appeared to have bottomed.

Then it came the rally up.

As price increased, so did swapping activity and USD volume.

But, when it came to a higher highs, activity and volume both decreased, even while price was high.

And when it started to rally up again, another surge, but it quickly began to die out.

As price decreased, so did activity and volume. But something a little different happened

While swapping activity seemed to have found its own bottom, even when price started to fall again, swapping activity held its level.

On the other hand, volume did move more drastically, falling along price, but even when price reached some form of rebound, USD volume kept falling down, even when price rised up it didnt do much for the Volume going out.

Just an addition in case you were left wondering why use Velodrome.

And why staking?

Well, the correlation metric is in fact quite straight forward, so i had to back my point with more sources.

So here are the deposits and withdrawalds from OP-Velo-USD-DAI pools.

> But these aren’t trading metrics.

No, but they do correlate with price movements.

While price is high, deposits are high. And when price is low, deposits are low, but in all cases, deposits still preferred instead withdraws

So where do we end up?

Well, remember the Yessnt? Somewhere in there.

The correlation for both swapping activity and USD volume is positive with price movements. But not to a higher degree.

For example, the initial price fall in June, didn’t actually match activity or volume being swapped. but those valleys in price, did correlate with the lower trading activity.

And when the price rised up again, trading activity did followed up. And when it fell back again, usd volume did fall even more than trading activity.

So these discrepancies between reactions to price movements which points us to a “moderate” correlation.