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On the Osmosis Frontier, there are pools for wETH and wBTC. How do users respond and change their position in these pools in response to governance proposals involving extra incentives for these pools? Do their deposits and withdrawals of wBTC and wETH onto Osmosis change as well?
Introduction and methods
Osmosis is a network that not only provides service to projects connected through the Interblockchain Communication Protocol (IBC), but also Acts as an AMM (Automated Market Maker), that is, a decentralized exchange, in which we can exchange coins from the networks to which it connects.
On of the main attractive features on Osmosis are the pools it offers that are incentivized to capt more users. The idea is to keep the community in a good vibes and to achieve it, the incentives vary over time. Because of there is a governance system in Osmosis, the increment of incentives of these pools are voted on Proposals.
In this dashboard we are gonna analyze the wETH and wBTC pools in the following terms:
- Users' votes on the different governance proposals involving the incentives for these pools
- Deposits and withdrawals variations onto Osmosis for these pools
The main proposals involving the wBTC and wETH pools are the following:
- Proposal 223 during 12-17 May: Reallocate half of the Incentives on OSMO/LUNA (#561) to OSMO/ETH (#704) & approve the pool for Osmosis incentives
- Proposal 229 during 16-21 May: WBTC Incentivised pool with Minimum Incentives of 5%
- Proposal 233 during 18-23 May: Incentives - Repo Process and Category Model
In terms of TVL on these pools, we can see how it could be an impact on the governance proposal voting period on the volume entering on the pools. While during that period the pools had a positive volume and increased their TVL, just after the period the deposited volumes decreased and the TVL turned negative.
Considering that the incentivized governance proposals taken place from 12 to 23 of May, we can see how the volume during that time was different in wETH and wBTC pools.
On the one hand, for wETH volume the amount of tokens deposited and withdrawn vary day by day. While during the incentivized voting period, the volume deposited increased and was higher than the volume withdrawn, during the period after the voting period the volume decreased. However, in May 31st something occurred and a heavy amount of volume was withdrawn from the wETH pool.
On the other hand, the volume of wBTC depdends on the day. While the volume in BTC not vary too much during the proposal voting governance period, it increased after that. In this case, there is no a heavy volatility in volume.
Finally, analyzing the proposal votes, we can see how in all of the proposals the major of the wallets voted "Yes". Around 20k users voted that in each of the proposals. However, it seems like the amount of voters decreased over proposals, but the percentage of "Yes" votes increased in general. Then, after a while, the "alternative" users changed their votes.