What is Osmosis (OSMO)?

Osmosis is an automated market maker (AMM) protocol that allows developers to create bespoke AMMs with sovereign liquidity pools.

Osmosis, which was built with the Cosmos SDK, makes use of Inter-Blockchain Communication (IBC) to facilitate cross-chain transactions. In other words, Osmosis is a decentralized exchange designed particularly for Cosmos, with intention to spread to other blockchains in the future.

Osmosis is one of the first Cosmos-based AMM DEX. TVL of Osmosis increase 100% since the beginning of 2022 ( $811.63m – $1.79b), Besides Cosmos is top 20 in the cryptocurrency market so the growth potential of Osmosis in the future is feasibility.

Osmosis is inspired by Uniswap, Balancer, and Curve Finance, so it has the advantages of all three mentioned AMMs.

The goal for Osmosis is to provide the best-in-class tools that extend the use of AMMs within the Cosmos ecosystem beyond traditional token swap-type use cases. Osmosis is a sovereign Cosmos zone that draws its sovereignty not only from its application-specific blockchain architecture but also from the collective sovereignty of the LPs who have aligned interests in various tokens for which they provide liquidity.

What is a DEX?

A decentralized exchange (better known as a DEX) is a peer-to-peer marketplace where transactions occur directly between crypto traders. DEXs fulfill one of crypto’s core possibilities: fostering financial transactions that aren’t officiated by banks, brokers, payment processors, or any other kind of intermediary. The most popular DEXs — like Uniswap and Sushiswap — utilize the Ethereum blockchain and are part of the growing suite of decentralized finance (DeFi) tools, which make a huge range of financial services available directly from a compatible crypto wallet. DEXs are booming — in the first quarter of 2021, $217 billion in transactions flowed through decentralized exchanges. As of April 2021, there were more than two million DeFi traders, a ten-fold increase from May 2020.

How do DEXs work?

Unlike centralized exchanges like Coinbase, DEXs don’t allow for exchanges between fiat and crypto — instead, they exclusively trade cryptocurrency tokens for other cryptocurrency tokens. Via a centralized exchange (or CEX), you can trade fiat for crypto (and vice versa) or crypto-crypto pairs — say some of your bitcoin for ETH. You can also often make more advanced moves, like margin trades or setting limit orders. But all of these transactions are handled by the exchange itself via an “order book” that establishes the price for a particular cryptocurrency based on current buy and sell orders — the same method used by stock exchanges like Nasdaq.

What is crypto staking?

Like a lot of things in crypto, staking can be a complicated idea or a simple one depending on how many levels of understanding you want to unlock. For a lot of traders and investors, knowing that staking is a way of earning rewards for holding certain cryptocurrencies is the key takeaway. But even if you’re just looking to earn some staking rewards, it’s useful to understand at least a little bit about how and why it works the way it does. 

What is the question?🚨

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With the launch of Flipside's new Balances table, let's take a look at how the story of Osmosis can be told through wallet balances. Provide insights into following metrics:

• How has the ratio of liquid to staked OSMO changed overtime?
• Are the top 100 OSMO holders the same now as they were at the start of the year?
• What is the current average OSMO per wallet? How has that value changed over time? Plot average OSMO/wallet against user growth.
• Do wallets normally hold a majority of OSMO, or another token? How has this changed over time?

Methodology

Osmosis has done a great job in ==2022==. but we need metrics to measure this ==growth== of ecosystem. It’s true that we want to do it with the wallet balances but we need some other metrics to compare wallet balances with them.

so before analyzing balance of wallets I plot the ==price==, circulating supply and market cap of ==OSMO==.

This dashboard obtains data from the ==osmosis.core== schema. Osmosis wallets are classified into four different wallet balance categories based on their ==USD== asset balances. All asset balances use USD as the unit of measurement, and all assets are converted to USD based on their price.

The ==four== types of wallet balances Osmosis wallets are classified as follows:

a. ==Fish== : Balance < 5k USD

b. ==Dolphin== : 5k < Balance < 50k USD

c. ==Whale== : 50k < Balance < 100k USD

d. ==Humpback Whale== : Balance > 100k USD

OBSERVATIONS

• Number of weekly Osmosis providing Liquidity is shown in balance categories in the above left graph.
• According to the graph, that shows us the count from Jun 14th to Oct 24th, the amount rises to its maximum during Jan 10th to Mar 28th and almost 70% of the total balances belongs to fish category.
• You can also study the Normalized number of weekly Osmosis providing tx in the image on the left.
• Normalized number of weekly Osmosis providing Liquidity tx tells that by the end of Oct 24th nearly 73% of this whole count is belongs to fish category.

OBSERVATIONS

• Similar to previous information about Liquidity tx, we have Number of Weekly Osmosis Wallets providing Liquidity in two images above this text and on the left.
• Pretty close to last section the Number of Weekly Osmosis wallets providing Liquidity is at its peek during Jan 10th to Mar 28th.
• The spike that we witness on May 16th is also like the one in Liquidity tx but with more intensity.
• Approximately 89% of the wallets providing Liquidity belongs to fish category.
• The percentage amount is more accurate to the Oct 24th by the image on the left which says 76.9% belongs to fish category.

Number of Osmosis Wallets in Different Categories

• As you can judge by looking at two images below this block, almost 95% of Osmosis Wallets (94.1% to be exact) belong to the fish category.
• The rest of 5.9% of wallets belong to Dolphin, Whale and Humpback which amounts are incomparable to Fish.
• The difference is easily noticeable and no longer needs an explanation.

OBSERVATIONS

• As you can see in the 2 images bellow this section, we have the Liquidity wallet count both by graph and percentage wheel.
• This count covers the date between Jun 14th to Oct 24th which rises drastically to the top of its peek on Feb 28th. We also have not so major spikes on Jan 17th, Nov 8th, Sep 13th and Jun 21th.
• About 80.8% of wallets are in fish balance category in the first place and after that we have Dolphin in the second place, Humpback in 3rd and last but not least we have Whale in the last place which holds only 1.81%.
• In the next row of images we have the number of weekly osmosis providing Liquidity tx (STARS/OSMO LP-Top 10 Deepest TVL Pool on Osmosis Zone) starting from Dec 13th to Oct 24th that rises to the top of its graph on Jan 24th and starts to fall continued by that point toward the end.
• As well as the percentage wheel we have 65.1% of fish balance in the first place and and Humpback, Dolphin and Whale are in order at 2nd, 3rd and 4th places.

Unique and cum unique Users

• As you can see, on the left side picture we can see a graph of Unique and Cum Unique Users. as well as Total Unique osmo wallet Users on the bottom block.

• According to the image on the left, which show’s the amount of Unique Users from Jan 1th till Oct 25th,total number of Users is rising from start to finish non stop.

• Also the total number of Unique OSMO Wallet Users is shown at the bottom block which is 481K till Oct 25th.

Over Time OSMO Price and Market Cap

• At the OSMO price graph, which is shown in purple color in bottom left side, we can see the price changes between Dec 14th to Oct 25th.

• At the start we can see the price rise, with a bit of vibrations , to the highest of its peek in Jan 16th. Then we witness a noticeable drop between Jan 16th and Mar 3th with a little bit of ups and downs in the middle.(lowest peek at Jan 31th)

• After Mar 3th to the end of the graph, which is Oct 25th, we can see a huge drop in price. Occasionally there were some little rising ramps as we can see from time to time. For example from Jul 1th to Aug 16th.

• On the red graph to the right we can see the Market Cap changes over time.

• The cap starts to rise from Dec 14th to Jan 16th and it peeks at approximately 1.83B. From that date forward we can see visible ups and downs till it peeked again in Mar 3th.

• Starting at Mar 3th forward we witness a huge amount of drop. On Jul 1th the Cap starts to slowly rise towards the end but it somewhat stables when it gets closer to Oct 25th.

OBSERVATIONS

• In columns down bellow we can see top 100 and top 10 OSMO holders.
• In top 100 OSMO holders image on the left which was gathered on Oct 20th we can see only 4 columns with significant amount the Yellow, Blue, Brown and Green, which hold the first 4 places in order that’s mentioned.
• Similar to that we have the top 10 OSMO holders Columns in the image on the right.

OBSERVATIONS

• In the graph on the right we can see Daily token balance by balance USD on OSMOSIS.
• this graph starts from May 11th and ends in Oct 25th. you can isolate the different parameters by double clicking on them in the graphs legend.
• USTC is at the first place by overall highest balance and then EVMOS and CRBRUS come in the 2nd and third place and the rest of the parameters can be studied easily by double clicking on them.
• By turning of the legend we can see the sum of tokens during different days in the date rate that we have.
• But for a more accurate overall study of amount of holders we have the columns bellow that will show us holders by token on osmosis and average balance by token on osmosis.

Liquidity And Staking’s Total Amount

• Total Liquid amount and stakes are shown in the 2 left hand blocks.
• Total number of OSMO Liquid Amount till Oct 25th is 385M.
• Total number of OSMO staked Amount is 269M till October 25th.

OBSERVATIONS

• The Average OSMO Per wallet is 1276 as shown in the information on the left.

• Average OSMO Value change over time (between Jan 1st to Oct 25th) is shown by the graph bellow on the left.

• This graph starts at its peek in Jan 1st and starts to continuously till Apr 24th.

• We can see a noticeable rise but overall the changes stabilize towards Oct 25th.

• The same Avg Osmo value is compared to the user amount in the next graph which are changing totally in opposite.

Conclusion

• Price of osmo and osmo market cap over time has been reducing over time greatly.
• In different balance categories we have the most OSMOSIS wallets in the fish category and the other categories like humpback, dolphin and whale are insignificant compared to fish.
• Even in the weekly osmosis wallets providing Liquidity and Liquidity tx, fish balance absolutely dominates by holding the majority of the percentage wheel shown at the top blocks.
• In the next section we can see the top 100 and top 10 holders of osmo in Oct 20th and Jan 1st in order.
• In the next graph we can see the daily amount of token balance by osmosis which is broke down to more visible information in the next 2 column sections, which according to, the first place holder by token on osmosis is USTC and the first spot in average balance by token on OSMOSIS belongs to LUM.
• The final crucial piece of information is Average osmo value changes over time which moves from 4000 to only 1276 per wallet from Jan 1st to Oct 25th. while in the same time the number of total users rise greatly in opposite of Average osmo value changes.

About me:

• Author: Hojjat
• Discord: hojjat7878#8809
• Twitter: @hojjat8d
• Email: hojjat78delshad@gmail.com

THANK YOU FOR READING!

Appendix

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The solution of this question and the queries are completely used from the filipside database. The construction of the dashboard was also used from the site app.flipsidecrypto.com/velocity, which belongs to flipside

Some ==queries== and charts and the ==method== description section are copied from the following dashboards:

Thank you very much dear ==banbannard== and ==saber_jl== and ==ngxuan885== and ==jacktheguy==