Delegators & Non-Delegators

To understand if there is a difference between the behaviours of delegators & non-delegators, first we must find what they are. Delegator accounts are Terra user accounts which have, at some point, delegated LUNA to a validator node to earn staking rewards. In this analysis, we looked at the top 1000 accounts by staked amount. Non-delegator accounts are those accounts who have never delegated. We took the top 1000 account balances (at 2021-07-24) by USD equivalent account balance. In this dashboard, we will look at a number of usage metrics and see if there is a difference between the groups.

Transaction Volume

The graph below shows the transaction counts on the Terra network for the two groups. There is a huge difference in transaction volume between the two groups. The 1000 delegators account for around 439k transactions, but the non-delegators account for around 2.71m transactions. This difference is worth investigating.

Top Transactors

The table below shows the top addresses sorted by transaction count. Of our top 1000 non-delegators, it looks like only 4 accounts have carried out 2.28m of our 2.71m transactions shown in the graph above. It's possible that these accounts are either algorithmic traders or arb bots due to the sheer volume of transactions carried out. For this analysis, we will focus on the behaviour of 'typical' delegators and non-delegators and filter these results out. If we leave them in, the data will instead largely represent these four accounts, rather than non-delegators in general.

Transaction Volume Revisited

Now we compare the two groups with our high-volume bots filtered out. The graph below is the same as the one above (transaction volume by delegator status) with the 4 big bot addresses removed. We can see that the number of transactions is almost the same across the two groups. We will need to look at more detail to see if there is a difference in other behaviours.

Which Applications are Used?

The next area of investigation is the applications used by each group (delegators & non-delegators). The graph below shows the transaction count by application, split by the delegator status. The applications Mirror and Anchor are self-explanitory - these are transactions on the 3 biggest Terra applications. There are a number of swap related transactions shown - native_swap is the swap between LUNA and native stablecoins supported by the Terra protocol, terraswap transactions are the AMM style swaps made on Terraswap, route_swap is a multi-hop swap on Terraswap and a swap_limit_order is an advanced swap with a minimum received token amount set to manage slippage. The airdrop column indicates the account claiming an airdrop and the cw20Token is a token related transaction (burn, mint, send, change allowance). This graph excludes a small portion of unlabelled contract calls for simplicity. Note the data below has the arb bots filtered as per above.

As seen in the graph below, delegators carry out more transactions on Anchor & Mirror than non-delegators. When it comes to swaps, however, the non-delegators carry out more swaps in aggregate than the delegators. The non-delegators do more native swaps, more swaps on Terraswap and more limit order swaps. It seems the delegators are only ahead on the exotic multi-hop route swaps.

Frequency of Transactions

The graph below is a histogram of the transaction counts by address, split by delegator status. The x-axis displays how many transactions an address has recorded, classified into a number of groups which represent: users with almost no transactions (0-10 transactions); light users (11-100 transactions); moderate users (101-1000 transactions); heavy users (1001-10000 transactions) and total degens (10000+ transactions). Here we see some significant difference between the delegators and the non-delgators. It appears as though over half of the non-delegators are also very light users of the network. Contrasting this, only 82 delegators have similar usage patterns. The non-delegators here may simply be hodlers, or relatively unsophisticated users. The moderate and heavy user groups (101-1000 and 1001-10000) also show a big difference between delegators & non-delegators. Here, there are far more delegators who are active on the network at these levels. It appears as though nearly 70% delegators not only stake LUNA, they also actively use the Terra network service. The final group on the chart is populated by non-delegators. These high-transaction addresses are possibly another group of bots (less active than the previous ones identified), however it is difficult to know without further data.

Conclusions

We have learned a few things about the behaviour of delegators and non-delegators on the Terra Network. We used the top 1000 delegators and non-delegators as the representative groups. We found early on that a massive number of transactions are undertaken by a small handful of user addresses. We assumed these were bots & excluded them from the analysis as they are an edge case in the context of other users accounts.

With the bots removed, we found that delegators & non-delegators had around the same number of transactions on the network. The two groups differed, however, in the applications they used. They delegators used applications like Anchor & Mirror more heavily, whereas the non-delegators concentrated their activity around swaps (both native and via Terraswap). When we looked at how active individual accounts were, we found that delegators tended to be more active on the network. Most non-delegator accounts were less active, and the total activity for this group was propped up by a small number of high-frequency transaction accounts.