The Question :

Visualize transaction fees on Polygon since July 1, 2022.

Compare these to fees on Ethereum over the same time period - are they correlated?

Do they diverge significantly at any points? Provide analysis as to why you think this might be.

Introduction :

Polygon ($MATIC) is an L2 scaling solution built on Ethereum with the goal of remedying some of the most significant barriers to Dapp adoption: speed, scalability, and usability. Polygon calls itself the “Ethereum’s internet of blockchains” as users on Polygon can create off-chain transactions for payments and smart contract interactions. Polygon takes a unique approach to L2 scaling influenced by plasma, which is a proposed L2 scaling solution that involves creating a tree-like set of “child blockchains” that use the Ethereum blockchain as a trust and arbitration layer. Child blockchains help reduce transaction costs by allowing many transactions to be batched before being sent to the Ethereum blockchain.

Matic uses something called MoreVP (More Viable Plasma), which allows for assets on the Ethereum blockchain to stay in place while transactions on the L2 can happen on a separate proof-of-stake network. Matic has multiple sidechains, and each is EVM-enabled which allows for smart contracts to be deployed and interacted with at a far lower cost than on the Ethereum mainchain.

Approach :

in this dashboard the following metrics had been Analysed :

 - Polygon daily transactions and Fees
 - daily FEE per TX index
 - Daily and Cumulative Fees Generated by Sectors
 - Fees Distribution by SECTORS
 - DEXs - Cumulative Fees by Platforms - Fees Distribution by Platforms
 - Defi - Cumulative Fees by Platforms - Fees Distribution by Platforms
 - NFT- Cumulative Fees by Platforms - Fees Distribution by Platforms
 - CEX- Cumulative Fees by Platforms - Fees Distribution by Platforms
 - DApp- Cumulative Fees by Platforms - Fees Distribution by Platforms
 - layer2- Cumulative Fees by Platforms - Fees Distribution by Platforms
 - top 10 platforms in terms of fee generating since July 1st, 2022
 - top 10 platforms in terms of FEE_per_TX since July 1s, 2022
 - Top 10 wallets that have generated the most amount of fees since July 1st, 2022
 - Polygon vs Ethereum - Daily Fees
 - Fee per TX on Different Sectors - Fee per TX on Different platforms

RESULTS :

the chart shows the daily transactions count and fees generated on Polygon since July 1sy, 2022 . the daily transactions has not fluctuated as the daily fees did. on July 2nd, the total fees dropped compared to previous day, and on July 3rd and 4th, an upward trend is visible.

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as the second chart illustrates, the fee_per_tx was high on July first and 4th.

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looking at the third chart which shows the daily fees generated by each sector, most of the fees was generated by dapp and dex on mentioned days

The pie chart shows that, Dex sector has had the most generated fees among in Polygon Sectors , followed by dapp and layer2.

the Dex and Layer2 Sectors have had the most exponential trend in terms of fee generating among in Polygon Sectors

Break Down Fee Generating by Sub Platforms :

looking at the polygon vs ETH daily fees chart, since July 3rd, the overall trend of daily fees trend for both networks was similar, while, from Jul 4th on, the gap between charts started to get expanded.

it is evident that both ethereum and polygon daily fees change over time. This could be due to either increasing transaction volume or increase in transaction fees or both.

However, it remains that polygon and ethereum fees follow the same trajectory, indicating some form of correlation. Moreover, we do not see any huge diversion.

Since Polygon is an L2 (second layer) of Ethereum, it is reasonable to lean towards the theory that increasing transaction volumes on Polygon, which are eventually settled on Ethereum are responsible for the correlation.

Findings :

Dex sector has had the most generated fees among in Polygon Sectors , followed by dapp and layer2.
Break Down Fee Generating by Sub Platforms :
DEX :

Quick swap (34%), uniswap v3 (21%) and Metamask(15%) routers , produced the highest amount of fees
Dapp:

opensea(88%) produced the highest amount of fees
NFT :

opensea(78%) produced the highest amount of fees
Layer2 :

Hop Protocol (over 90%) produced the highest amount of fees
Defi :

tetu (30%), lendingpool(23%) and AAVE pool v3 (22%) produced the highest amount of fees
top platforms in terms of fee generating since July 1st, 2022 :

opensea(33%), Quick swap(16%) and uniswap v3 (10%) produced the highest amount of fees among all subplatforms of Polygon
top platforms in terms of FEE_per_TX since July 1s, 2022

etherlands, microbuddies and fabwelt had the highest amount of fees per tx among all subplatforms of Polygon
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