DeFi Weekly Report | Week 36, 2021
A bird's eye view of the money flows across blockchains and within each DeFi building block.
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On-Chain Metrics
Total Addresses by Chain
The number of Polygon wallets, recorded at 58.4 million, continues to a strong rise this week and is behind that of Binance Smart Chain by approximately 35 million ~ 37.44%.
On average, the number of Polygon addresses created on a daily basis approximates 500,000, while that of Ethereum ceases to increase beyond 110,000, and that of Binance Smart Chain is estimated at 167,000.Β
Daily Active Addresses by Chain
Overall, the numbers of active addresses of the three chains experience a trendless week. The number of active Ethereum, Polygon, and Binance addresses has been moving sideways in the range of 500,000, 177,000, and 1 million, respectively.Β
Daily Transactions by Chain
While there is little upward or downward progress on the number of active wallets, the volume of transactions on Polygon is on the rise again, reaching 7 million. The volume of transactions on Binance Smart Chain saw a drop from last week, recorded at only 6.2 million (a decrease of 21.44%). Meanwhile, Ethereum transactions stabilized at approximately 1.2 million.Β
The daily transaction per address ratio on the Polygon blockchain increased moderately to 39.6, which indicates a larger number of user transactions recently. By contrast, the ratio on the Binance Smart Chain declined by 1.89 from last week, reaching 5.82. On the other hand, the Ethereum ratio remains within the range of 2 and 2.5.Β
Layer 2
Layer 2: Total Addresses
At the moment, the post-launch results of Optimism and Arbitrum have been positive. The number of Optimism addresses grew to nearly 50,000, while that of Arbitrum has reached almost 20,000.
Layer 2: Daily Transactions
Arbitrum demonstrated a positive growth trend with its number of transactions coming close to 20,000. Optimism, on the other hand, experienced a pullback after peaking at 45,000.Β
Layer 2: Ecosystem
The Arbitrum ecosystem has experienced a strong and steady development, with more DeFi blue-chip projects transferred to L2 from L1.
Optimism is also associated with positive growth, inviting several blue-chip DeFi protocols such as Uniswap, 1inch, and Synthetix,...etc into its ecosystem.
Decentralized Finance
Overview
Total Value Locked witnessed a slight drop of 4.72% and remained at $148 billion. This coincides with the downward market trend when Bitcoin value failed by $10,000 after reaching $53,000.
Solana is now #3 in terms of TVL.
Solana locked in a total value of $8.7 billion (a spike of 133%, from $3.7 billion) in 7 days, which allowed it to supplant Terra as the third-largest chain, following Ethereum and Binance Smart Chain, in terms of TVL.Β
Total Value Locked by Category
EthereumThis week, the TVL of Ethereum saw a slight reduction of 7.17%, reaching $99.9 billion. Meanwhile, Lending continued to attract the majority of the flow of cash, which was estimated at $42.68 billion, followed by DEX, estimated at $30.4 billion.
Binance Smart ChainTotal Value Locked of Binance pulled in $24.86 billion, a decrease of 11.3%. Binance DEX accounted for 57.68% of the total value. TVL of the Lending sector decreased moderately by 12.1% from last week, accounting for 24.6% of the total value. TVL of the Derivatives sector saw a slight downward trend, declining by 2.8%, pulling in $1.35 billion, making up 5.44% of overall value.
Polygon
Total Valued Locked of the Polygon blockchain saw a gradual decrease, currently sitting at $5.4 billion. The DEX sector made up only 50% of the total value, a decrease from 60% in early July, indicating a reduction in the free cash flow through the Polygon network. Meanwhile, the lending sector slowly occupied more market shares, reaching 41.54% at the time of writing. However, the lending sector is dominated by Aave, with a market share of 91.5%.
Solana
Solanaβs TVL increased sharply by $5 billion within a week, currently sitting at $8.7 billion. DEXs accounted for the majority of TVL, estimated at 61.2%. Saber, an AMM for stable assets, saw considerable growth when its TVL spiked from $900 million to $2.8 billion in only 7 days.Β
Occupying second place is the Asset sector, accumulating a total value of $3.1 billion, which translates to 35.66%. Within the Asset sector,Β the Sunny Protocol, a composable yield aggregator, demonstrated impressive growth, locking in $2 billion in less than 10 days.Β
Solana lending platform has received scant attention from the public, accounting for only 3.14% of total TVL, which is approximately $273 million. Within this sector, Parrot is winning with its contribution of 40% of TVL. Parrot is launching its IDO on the 14th of September (information can be found here πhttps://gopartyparrot.medium.com/wen-the-parrot-ido-plan-fb79c45c43fa)Β
Avalanche
Total Value Locked on Avalanche chain showed little growth, after having reached an all-time-high of $2 billion last week. More than 94% of Avalancheβs TVL belong to the four protocols Benqi, Trader Joe, Pangolin, and Yield Yak, which shows a lack of diversity.Β
Terra
Total Value Locked by Terra chain experienced stagnation this week, slightly dropping back to $7 billion, 98.3% of which, was contributed by the leading protocols, including Mirror (Derivative), Anchor (Lending), Terraswap (AMM), and Lido (Asset).Β
A Closer Look in DeFi
Decentralized Exchange
Overall, all blockchains witnessed a decrease, with the sharpest decline of 18.09% observed in DEX of the Terra protocol. The number is followed by Avalanche (-15.7%), Polygon (-12.46%), Binance Smart Chain (-11.88%), and Ethereum (-9.9%). Solana-based DEXs, however, witnessed a growth of 86%, which exceeds $5 billion, in terms of dollars.Β
DEXsβ Liquidity by Protocol
In general, all protocols expressed a downward trend. Curveβs liquidity pool value was the highest, followed by Pancakeswap.
Raydium and Saber are winning the liquidity race. Meanwhile, Ellipsis, MDEX, QuickSwap, and Terraswap, are lagging behind. Trader Joe showed potential growth, having pulled in a total liquidity volume of $450 million in a month.
Weekly DEX Trading VolumeΒ
DEX volumes diminished further, although they exceeded $40 billion, almost reaching $43 billion. UniSwap v2 + v3 continued to be the two protocols with the highest trading volume of $14.6 and $11.2 billion, reportedly. PancakeSwap came in third, with more than $6 billion in trading volume.Β
Daily Active Users
The number of PancakeSwap active users saw considerable fluctuations, increasing back to 260,000, after having plunged significantly from 300,000 to 200,000.Β
Overall, total DEX users on Ethereum experienced a minor drop, while that of QuickSwap (DEX on Polygon) remained stable at approximately 16,000.Β
Lending Landscape
Ethereum continued to lead the lending sector, pulling in $42.68 billion, a subtle decrease of 6.8%, as compared to last week.Β
Lending value locked by Binance Smart Chain dropped to $6 billion, after having reached $6.96 last week. Terraβs positive growth, and Polygon and Avalancheβs stagnation were also observable. Moreover, Solana showed steady, but weak, growth.Β
Lending Value Locked by Protocol
MakerDAO, Compound, and Aave continue to be the leading lending platforms, despite noticeable decreases in the total lending values. Meanwhile, Anchor has the potential to grow and surpass Venus in a few weeks, after having overthrown Aave_Matic mid August.Β
Outstanding Loan Amount by Protocol
Although their TVL experienced a sudden drop, total outstanding loans remained within the range of $9.1 and $9.3 billion. The total outstanding loans of MakerDAO saw a modest increase to $6.5 billion. Meanwhile, such numbers of Venus and Aave_Matic saw a plunge, following market corrections executed in the previous week.Β
Derivatives (Ethereum)
Daily perpetual swap trading volume dropped to $1 billion, following its peak at $2.6 billion by the end of August. Data revealed that dYdX demonstrated excellent volume growth, after having incentivized their dYdX tokens. Most updated numbers show a dYdX volume that is four times that of Perpetual Protocol.
Non-Fungible Tokens
In the past 30 days, Axie Infinity has been leading the revenue race, accumulating $752.7 million. Artblocks came second with a total of $592 million, however, its rate of increase stagnated.Β
Loot, a project that has garnered much attention lately, saw a slow increase rate of sales revenue, although the total was nearing $229 million. Parallel Alpha, Pudgy Penguins, 0N1 Force, Bored Ape Yacht Club, Meebits, and Crypto Punks were under the same circumstance.
Fundraising Spotlight
Many projects have successfully raised funding the past week, the most notable of which being Eden Network with $17.4 million.Β
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