Methodology

I have used Flipside's optimism.core.fact_hourly_token_prices table to track OP's price. This dataset is identical with the one provided by coingecko, however the missing hourly price values have been forward filled.

Cex and dex addresses were collected from optimism.core.dim_labes table and token transfer volumes to and from the addresses were aggregated daily.

OP Price Action

Compared with ETH we see, that OP is highly correlated with ETH.

Common features:

• Rally from 10.21 to 11.05 (from - to)
• Sharp breakdown from 11.08 to 11.10 (the FTX Meltdown) ($1.30 to $0.79 for OP)
• consolidation and recovery with a $1.19 high for OP

OP Features

• The October rally had a drawdown from 10.30 to 11.02 from $1.19 to $0.95 a move with no parallel in ETH
• While the October low was comparatively lower for OP $0.64, OP weathered the FTX storm much better than ETH
• In fact, OP improved 15-20% on it’s October average, while ETH price decreased by the same relative amount.

Cex OP flows and net Balance change

• High OP CEX outflows often follow price drops (11.01, 11.08, 11.12, 11.28, 12.13, 12.16)
• High OP CEX outflows often preceed price surges (10.26, 11.01, 11.08, 11.28, 12.13)
• The pace of OP CEX inflows is more even, harder to discern features
• High OP CEX inflow as price surges (10.23 - 10.26, 10.24, 11.23, 12.01, 12.12)
• High OP CEX inflow as price drops (11.08 - 11.10)

DEX OP flows net balance change

• OP flows to and from DEX addresses are largely symmetric, possibly due to arbitrage bots
• net DEX balance change seems limited
• An overall net DEX inflow built up to 10.21 as price has hit it’s recent low at $0.64
• DEX OP change dropped between (10.26-10.27) as the price rose from $0.75 to $1.1
• There is a weak negative correlation (-0.52) between DEX OP change and the OP price

OP Swaps on Sushiswap

• The Net Balance of OP at SushiSwap pools decreased as the price increased (10.21-11.04)
  • in this period WETH and USDC swapped for OP on Sushi (units on pie chart are in OP)
    • 17/83 (USDC/WETH) for OP_IN
    • 23/77 (USDC/WETH) for OP_OUT
• The FTX meltdown saw increased OP Swap volumes on Sushi (11.07- 11.09)
  • 3/97 (USDC/WETH) for OP_IN
• The correlation between the net OP balance change at Sushiswap and the OP price is -0.67

OP Swaps on Velodrome

• Velodrome swap volumes vastly outstrip Sushiswap’s for OP tokens
• Velodrome net OP change and OP Price change is anti-correlated as well: correlation: -0.9
• This high anti-correlation suggests that the Velodrome markets are coupled more closely to the price
• During the OP price increase (10.21-11.04)
  • 82.8/7.6/5.5 (USDC/WETH/VELO) for OP_IN
  • 82.6/7.6/5.5 (USDC/WETH/VELO) for OP_OUT
• A large outflow and inflow have also occurred during the FTX meltdown between 11.08-11.09
  • 78.2/10.9/7.4 (USDC/WETH/VELO) for OP_IN

• One might notice, that the Velodrome OP swap volumes also dwarf the total DEX in and outflow volumes as well. This is because there is only 3 velodrome OP pool address listed among the dex addresses in the optimism.core.dim_labels table

Key Findings

• OP’s price is highly correlated with the price of ETH, but OP had weathered the FTX storm much better and have gained 15% compared to it’s October average, while ETH has lost as much
• large CEX outflows have followed price drops and preceded price surges
• large CEX inflows occurred most of the time while the price was surging, except for the large FTX meltdown (when they occurred during a price drop)
• DEX flows are very closely symmetric, but the net OP change in the pools is anti-correlated with the price movement (the larger the market the tighter the correlation)
• Velodrome is the dominant DEX marketplace for determining OP’s price
• OP is mostly traded for WETH on Sushiswap and for USDC on Velodrome
• Both marketplaces usual swap counterparty profile shifted by ~5% during the FTX meltdown