Try Quests to earn cryptoAlgorand - Transactions by Protocol
Outline
For this question, we are taking a look at the applications calls executed by Algorand’s protocols. In particular, we are interested in the behaviors of Folks Finance, AlgoFi, Tinyman, and AlgoDex.
Since we are analyzing the number of transactions, each of these protocol’s launch time plays a significant role in our analysis. Here is the launch time of these protocols:
- Tinyman: October 2021
- AlgoFi: December 2021
- AlgoDex: February 2022
- Folks Finance: April 2022
Note: In our analysis, we considered the statistics during the past 30 days. Meaning from June 13 to July 13, 2022
Transactions by Protocol over Time
The figure on the right shows the number of transactions performed by each protocol application call over time in the past 30 days. Note that the Y-axis is log-scaled.
Our observations:
- We can see that the 4 applications divide into 3-tier set. Tinyman and AlgoFi, are the biggest players in the game, that execute billions of transactions per day. Then we have AlgoDEX that operates two orders of magnitude (1/100) lower than the previous two. The smallest of these four is Folks Finance which executes thousands of transactions per day.
- Tinyman and AlgoFi are the two close competitors. Since June 13, Tinyman was the dominant application, but when AlgoFi passed Tinyman in the number of transactions on July 2, the competition got tighter and we cannot pick one as the biggest application. Maybe in the future one out-wins the other.
- The general trend for the top 3 applications were downward since July 13 with occasional spikes. But the trend for the Folks Finance were different. Thought it is the smallest of the group, the number of transactions increased when the other 3 experienced a downfall.
Transaction Fees
Next, we want to analyze how much fees has been spend on each protocol. The figure on the right shows the share of each protocol from the whole fees spent on Algorand during the past 30 days.
Our observations:
- Continuing the observations of the previous section, we can see the the top two protocols, algoFi and tinyman, absorbed the almost the whole transaction fees, 99.9%.
- Though tinyman was ahead of algoFi around min-June, algoFi was able to improve and now it is responsible for 2% more transaction fees on Algorand.
- The Algo DEX and Folks Finance, are responsible for 0.1% of the whole transaction fees, combined.
Number of Transactions vs. ALGO Price
In the final section, we want to analyze the relation between the number of transactions executed on each protocol vs. the ALGO price during the past 30 days. We devide these protocols based on their behaviors into two sections.
Tinyman, AlgoFi and Folks Finance:
The ALGO price and the number of transactions on both Tinyman, AlgoFi and Folks Finance have almost an inverse relation with one another. E.g. on June 16, June 25 and July 9, as the number of transactions decreased, the price of ALGO increased. And on June 18 and June 30 and July 11, when the number of transactions increased, the ALGO price increased. We suspect that this might be because of the fact that on average, people (small and big HOLDers) tend to hold when the price goes up and sell when it comes down.
AlgoDex:
AlgoDex behaved differently from the other three protocols. When the price went up, the number of transaction went up too and when the price decreased, the number of transaction did the same. We think that since the AlgoDex is a small exchange, it reacts to the market very rapidly and shows holders’ panicking.
Conclusions
- AlgoFi and Tinyman are the biggest protocols on Algorand. with orders of magnitude higher transactions than AlgoDex and Folk Finance.
- Almost all transaction fees are the results of activities on AlgoFi and Tinyman.
- All of these four protocols reacted to ALGO price volatility, each in a different manner.