stETH vs ETH

Depeg

The chart below represents the hourly price of stETH and WETH since 1st May 2022. When both assets trends downwards over time, on May 12th , there is a significant price gap between 2 assets, where stETH is lower than WETH. This is significant as both assets represents the same asset 1 ETH, so in theory, they should have about the same price. The price gap has been continuing until today, 5th June 2022.

Quantifying Price Gap

To measure how much the price devates, we find the diffrence between the asset, per ETH price. This will represent the gap in terms of per unit ETH. Multiplying by 100, it will be represented into percentage.

We can see from the chart, the most significant deviation is on May 12th. Overall, we can say the deviation some what stable, despite having a large "Amplitude" range. The May 12th deviation has caused the The deviation being higher than usual across time, but the stability is still about the same.

Transactions on May 12th

The chart below shows the number of transactions by event type. There are 2 events that are in 0x`s format, that doesnt return any result on Etherscan

Which transfer functions involve the largest amount of stETH?

The chart below shows the distribution of stETH involved in the transfer events. The chart only visualizes the top 5 functions that returns the largest stETH used.

Possible cause : Liquidity Removed

The chart viusualizes the amoun of stETh removed from the liquidity pools. 230 K stETh were removed from liquidity pools. When massive amount of liquidity is removed, it causes high slippage, hence, causing swaps/trade activities on DEXs to comes with high price impact.

Findings

On May 12th, the stETH price deviatess significantly from WETH. The high price difference were riggered on May 12th 2022. From analyzing the transfer events, we have found that there is a large amount of stETH removed from liquidity pools, 230k stETH. From this, we can deduce that this event may has caused the price deviation, as low liquidity in pools, results in high slippage.