Project : Optimism

Bounty Name : Optimism DEXs (redux)

Question: Let’s take a closer look at DEXs on Optimism. Make a dashboard that compares at least three DEXs based on:

• Total number of swaps by day over the last month

• Total number of wallets swapping by day

• What are the most popular asset pairs to swap from and too

• Top 10 assets swapping from

• Top 10 assets to swap to

  \

Date of analysis : 2022-10-25

What Is Optimism?

Optimism is a Layer 2 scaling solution for Ethereum**. It helps reduce the transaction fee and transaction time on the Ethereum blockchain.

Broadly speaking, Optimism helps solve Ethereum’s scalability dilemma. Scalability refers to the rate of transactions per second (TPS) on a blockchain network.source

What are decentralized exchanges?

Decentralized exchanges rely on smart contracts to allow traders to execute orders without an intermediary. On the other hand, centralized exchanges are managed by a centralized organization such as a bank that is otherwise involved in financial services looking to make a profit.

Centralized exchanges account for the vast majority of the trading volume in the cryptocurrency market because they are regulated entities that custody users’ funds and offer easy-to-use platforms for newcomers. Some centralized exchanges even provide insurance on deposited assets.

The services offered by a centralized exchange can be compared to those offered by a bank. The bank keeps its clients’ funds safe and provides security and surveillance services that individuals cannot deliver independently, making it easier to move funds around.

In contrast, decentralized exchanges allow users to trade directly from their wallets by interacting with the smart contracts behind the trading platform. Traders guard their funds and are responsible for losing them if they make mistakes such as losing their private keys or sending funds to the wrong addresses.

The customers' deposited funds or assets are issued an “I owe you” (IOU) via decentralized exchange portals, which can be freely traded on the network. An IOU is essentially a blockchain-based token that has the same value as the underlying asset.

Popular decentralized exchanges have been built on top of leading blockchains that support smart contracts. They are built on top of layer-one protocols, meaning that they are built directly on the blockchain. source

Velodrome

Velodrome Finance is designed to solve one of the main problems for any DEX; incentivizing liquidity reduces the value of the DEX’s token. They address this problem by aligning protocol growth with fee generation, not just liquidity. In other words, take Curve Finance‘s sophisticated AMM and Solidly’s incentive structure, combine, shake well, and serve. Enjoy Velodrome!

Uniswap

Uniswap is a completely different type of exchange that‘s fully decentralized – meaning it isn’t owned and operated by a single entity – and uses a relatively new type of trading model called an automated liquidity protocol (see below).

0x

0x is an open-source protocol that enables the frictionless peer-to-peer exchange of assets on the Ethereum blockchain. The team envisions a future where all types of assets will be tokenized on the Ethereum

Balancer

Balancer is a software running on Ethereum that seeks to incentivize a distributed network of computers to operate an exchange where users can buy and sell any cryptocurrency.

An emerging decentralized finance (DeFi) protocol, Balancer uses a combination of crypto assets to provide this service, enabling trading without a financial intermediary like an exchange.

Methods

Tables I used: I used optimism.core.fact_event_logs for Uniswap,Balancer & 0x and i filter transactions of these DEXs with event_name = 'Swap' because i just want Swap transactions and i count tx_hash for number of swaps and distinct Origin_from_address for unique users.

I use optimism.velodrome.ez_swaps for Velodrome because this table is special for Velodrome.

Addresses:

Uniswap: '0xe592427a0aece92de3edee1f18e0157c05861564','0x68b3465833fb72a70ecdf485e0e4c7bd8665fc45'

Balacner: '0xba12222222228d8ba445958a75a0704d566bf2c8'

0x: '0xdef1abe32c034e558cdd535791643c58a13acc10'

All data and analysis are from 31 days ago

Metrics

• Number of Swaps per DEX
• Number of Active Users per DEX
• Total Number of Swaps per DEX
• Percentage of Swaps per DEX
• Total Number of Active Users per DEX
• Percentage of Active Users per DEX
• Number of Swaps per User
• Top 10 Swap from Asset based on Swaps
• Top 10 Swap to Asset based on Swaps
• Top 10 Swap pairs based on Swaps

Conclusion

In general, the trend of user activity and the number of users in Optimism has been decreasing in the last month, and during this period, the situation has changed a little, because at the beginning of this month, the dominance percentage of UniSwap and Velodrome was very close, but in the middle of the month, Velodrome was able to overtake UniSwap. and the next very important point is that the users of Velodrome are much more active than its competitors, because although the users of this dex are less than UniSwap, the number of swaps is more, so this shows that its users are very active.

Thanks for reading

• All data used are from: Flipside Crypto

  \

• My Twitter: Sepehrmhz8

The assets that are used for trading in DEXs are very important because there may be an asset in a DEX that is not in other DEX and that is why users are attracted to this dex.

The most popular asset that UniSwap users used to swap to another asset was USDC, which is a powerful stablecoin and has been swapped 133,000 times in the last month.

In Velodrome, the most popular asset to swap to another asset is USDC, which has been swapped to other assets 252,000 times in the last month.

At 0x, the most popular asset to swap to other assets is USDC, which has been swapped to other assets 8 thousand times.

In UniSwap, the most swaps of assets are to USDC, so that during the last month, 116 thousand swaps have been made to USDC on this platform, and this number is 270 thousand swaps in Velodrome, which is almost 2 times more than Uni Swap.

In Optimism, the most popular asset for swapping between DEXs is USDC, because the number of swaps is very significant.

Optimism DEXs Overtime

As you probably know, Optimism is one of the most powerful layer 2 of Ethereum and has many active users, and in order to exchange their assets, these users have to use one of the DEXs available on this network. I compared some of the DEXs on this network to find out which one is more popular among these DEXs.

If you pay attention to the graph below for the number of swaps of each DEX, you will notice that during the last month the number of swaps has been in a slow downward trend and Lee has improved a little in the last few days and can be said to have stabilized.

During the last month, the highest number of swaps was recorded for September 23, when 50,000 swaps were made on these 4 DEX, and the largest number of swaps was recorded for Velodrom with 28,500 swaps, which is more than It is considered to be 50% of the swaps of this day, which can be considered as a sign of the popularity of this DEX on optimism.

Among these 4 DEX, the competition in the number of swaps and users is the most between Velodrom and UniSwap, which shows that these two DEX are highly popular among the users of this network.

In the number of swaps of each DEX, if we want to check the percentage of dominance of each DEX, we will find that there is a lot of competition between UniSwap and Velodrom and the activity in these two DEXs is very close.

Let's look a little more closely at the percentage of dominance between these two competing DEXs. From September 22 until October 8th, the competitors were very fierce, and on some days, UniSwap had more swaps, and on other days, Velodrome had more swaps, but after October 8, UniSwap's dominance percentage suddenly dropped. It reached 28% on October 13th, which was a very low value, and after that, this DEXwas able to recover a little and bring its dominance percentage to about 45%, while Velodrome's dominance percentage is close to 50%, and this shows Since October 8, UniSwap has failed to reach the velodrome.

In terms of the number of users, the situation is slightly different because if you pay attention to the dominance percentage in the number of users, you will see that UniSwap's dominance percentage is the highest among its competitors almost all days, and it was close to 60% in most cases. which is a good amount, but if you had paid attention to what I said a little earlier, you would have noticed that the number of Velodrome swaps was more than UniSwap, but the number of users was less than UniSwap, so we realize that Velodrome users are more active than UniSwap users, although a little ahead We will examine this in more detail.

Optimism DEXs Total Stats

As it was already clear, the number of Velodrome swaps was more than its competitors, and a total of 461,000 swaps were done in this DEX during the last month, while the total of UniSwap swaps was 383,000. It means that UniSwap has failed with 78 thousand swaps less than its competitor, and that means an 8% difference in the number of swaps made Velodrome win.

In the number of users, as I said before, the situation is a little different because UniSwap has the most users among these DEXs, but you probably guessed wrong like me, because the number of swaps is less than its competitor Velodrome, so there should be less users. But it is not because UniSwap has a total of 74 thousand users while Velodrome has a total of 42 thousand users, which means a difference of 19 thousand between the number of users of these two big DEXs. But the very important thing is that the number of users is always more, it does not make it superior because even though UniSwap has more users, the number of swaps is less, so it shows that the users of this platform are not loyal to it, that's why the activity They are few.

The point that caught my attention was the number of 0x users, because this platform has 8 thousand users, which is not a small number among the big DEXs, but these users are not active at all because the number of their swaps is very small.

When we talk about being active, you should look at Velodrome, because on average, each user of this platform makes 11 swaps, which is a very good number, and this shows how active and loyal the users of this DEX are to this platform, but the competitor It means that UniSwap's users make 5 swaps on average, that is, half of Velodrome's users, which shows that even if the number of users of a platform is small, but they are active and loyal, they can make that platform win.

Top 10 Swap from Asset

Top 10 Swap to Asset

In UniSwap, the most popular pair among the traders of this dex is ETH->USDC, because during the last month, nearly 132,000 swaps have been made, which is a significant amount, that is, nearly 30% of all UniSwap trades are for this pair.

In Velodrome, the most popular currency for users of this platform is OP->USDC, because it has been swapped 47,000 times in the last month, which is 10% of the total number of Velodrome swaps.

In 0x, the most popular peer is ETH->USDC, with a total of swaps.

Top 10 Pairs