The Question

Track the flow of Matic to Osmosis. Where is this MATIC coming from? Did users remove this MATIC from specific protocols to bridge over to Osmosis?

** \n **

Additionally, analyze the change in daily/weekly bridged volume since incentives were turned on. Judge the success of the incentives in driving liquidity over to Osmosis. Are most users bridging MATIC new users or existing Osmosis power users?

** \n **

Introduction

Summary

The Osmosis automated market maker (AMM) affords users the ability to create new and unique liquidity pools that are controlled and voted on by participants. The Osmosis token (OSMO) is used to vote, stake, and provide liquidity throughout its pools. Superfluid staking, a process novel to the Osmosis protocol, allows users to stake assets to secure the network while simultaneously providing assets in a liquidity pool.

The Cosmos Ecosystem

Osmosis is a decentralized exchange (DEX) and automated market maker (AMM) protocol for the Cosmos ecosystem. To understand the specifics of Osmosis, it’s helpful for you to know the context of the Cosmos ecosystem upon which and for which it is built. Cosmos is an overarching ecosystem of blockchain networks that can connect with one another as part of Cosmos’ mission to build an “internet of blockchains.” Interoperable decentralized applications (dApps) on these various networks communicate with each other and send tokens and data back and forth via Cosmos’ Inter-Blockchain Communication (IBC) Protocol.

The Cosmos Hub is the mainchain that serves as the central ledger and primary blockchain protocol to connect with other blockchains in the Cosmos Network. It is a Proof-of-Stake (PoS) blockchain built by the Ignite team and uses ATOM as the native token for voting, staking, and transactions. Cosmos also provides a software development kit (SDK) to enable projects and teams to build on its network. Now that we have a surface-level understanding of Cosmos and how it operates, we can dive deeper into Osmosis.

The Osmosis AMM

Osmosis is a DEX protocol, which means it uses smart contracts to determine the price of digital assets, to produce liquidity via a peer-to-peer (P2P) methodology, and to exact trades between users. This approach to an exchange platform is known as an AMM — a DEX protocol that prices crypto assets in liquidity pools. Contributing tokens to these pools helps foster decentralized liquidity, which is then used to facilitate trades on the exchange. Participating as a liquidity provider (LP) can earn you both trading fees and newly minted LP tokens as incentives for participation.

The Osmosis AMM is unique in that it affords users the ability to create their own liquidity pools, or to duplicate existing ones with their own unique parameters. Because Osmosis is built on the Cosmos ecosystem, users are able to natively trade assets from more than 47 different chains within Cosmos.

While most AMMs today are fairly efficient at providing liquidity in a decentralized manner, they still operate as service-based products: the platform creates pools that are free to join. In the dynamic landscape of decentralized finance (DeFi), this can arguably compromise the efficiency of the liquidity pools available for use. To help solve these issues, the Osmosis AMM was conceived as a “serviced infrastructure” that provides users the ability to tweak the values of tokens and the supply, therefore lowering the barrier to creating custom-built AMMs.

Two primary concepts that drive the Osmosis protocol are sovereignty and heterogeneity. To that end, Osmosis makes use of self-governing liquidity pools. These liquidity pools that exist in Osmosis are not hard-coded and users can use the native Osmosis token (OSMO) to vote on pool parameters and protocols, provide liquidity, and stake. Essentially, it allows holders of the token to decide the make-up of specific liquidity pools, in addition to playing a central role in wider Osmosis protocol governance.

OSMO Token and Superfluid Staking

OSMO is the native token of the Osmosis network. Primarily, OSMO is used for staking to secure the Osmosis chain. As a PoS token, OSMO is inflationary. Over time, new tokens will be minted and entered into circulation. The maximum number of OSMO tokens has been set at 1 billion. As of May 2022, there are 282 million OSMO in circulation.

A key innovation within the Osmosis protocol structure is superfluid staking, which allows users to both stake tokens while simultaneously using them to provide assets to a liquidity pool. This means Osmosis users are rewarded for helping secure the blockchain while staking, and receive reward fees associated with liquidity pool transactions. The first Osmosis token pool to allow for superfluid staking is the ATOM/OSMO pool, which is the top Osmosis crypto staking pool by volume and includes both OSMO and the Cosmos token ATOM.

Osmosis’ use of superfluid staking is designed to not only increase users' capital but also contribute to the security of other blockchains in the Cosmos ecosystem. Prior to the innovation of superfluid staking, if a user brought their assets to Osmosis to earn block rewards in one of the liquidity pools, the blockchain that provided those assets would not be able to use them to secure the chain. With superfluid staking, users supply the liquidity pool while still staking the underlying asset in the blockchain from which it came. To that end, Osmosis and its OSMO crypto staking feature strengthen the security of all Cosmos blockchains, in addition to providing a core DEX for the Cosmos ecosystem.

Part 1 - Looking from Outside

The time period of this investigation is considered from start of November, 2022. The time of incentives turn on Osmosis was December 20, 2022.

This part represents the outcomes related to the source of transferred MATIC into the Osmosis network:

results:

The average and median of transferred volume afterincentives turned on are higher than before implementation of incentives.
As shown in the graphs, the total volume in MATIC and USD for transferring MATIC into the Osmosis network are high after incentive turned on compared to previous time.
The count of transfers and unique recievers reveal that the activity of transferring MATIC into the Osmosis network enhanced after incentives turned on.
The highest volume of transferred MATIC into the Osmosis network occurred on December 22 with over 49k MATIC tokens worth over 38k USD.
The over time investigation validate the domination of after incentives turned on period (December 20, 2022) from the all metrics point of view.
The outcomes related to the source chain of transferred MATIC into the Osmosis network demosntrated in the Table and as can be seen, the Axelar network is responsible for transferring MATIC into the Osmosis.
Top senders of MATIC into the Osmosis network dominated by "axelar19xj4ncc6h6y5ahpfqtspdx75y3dkrxj3zpah9k" with over 491k MATIC.
The origin of MATIC receivers on Osmosis is divided into the two groups based on the date of wallet creation. According to the results, most of the MATIC receviers on Osmosis side are old wallets (created before incentives turned on).
Beside Osmosis, the Cre network is the second most used network by senders of MATIC into the Osmosis on the Axelar side.

Part 2 - Looking from Inside

The time period of this investigation is considered from start of July, 2022 in order to better understand the trends.

Also, to avoid overloading, the scale is weekly in this part.

The time of incentives turn on Osmosis was December 20, 2022.

Methodology

In this dashboard , you can find three main parts.

In the first main part, the Sources wich users receive MAtic tokens from, have been compared and presented. the metrics provided in this section are :

Weekly and total share and also cumulative #users,#Txns and Value $ per sources.

The second part also provides information about the Receiving activities of MAtic by Osmosis users in cumulative, weekly and general basis.

the third part also shows the fisrt time (Matic receiving) users stats on osmosis , as weekly, cumulative, total and weekly distribution of users based on amount received.

In the last part, the most popular fist actions of these receivers is revealed and analyzed.

hope you enjoy it

Receivers’ profile

Firdd

Observations

The charts show the first actions of Matic receivers on Osmosis network as overall share , cumulative and weekly #users and #txns.
It can be seen that , in terms of Number of Txns and users swapping is the most popular action after receiving an IBC token , with over 52%.
Transfer is the second popular action with 24% and LPing is the third one with 14.6 % .
in terms of volume of transactions, Transfer ranked first with 37.3 % followed by swapping with 26 %.
Osmosis was the token which most of Matic Receivers swaped theire Matic for, as the first transaction. USDC is ranked second , followed by Comsos Hub Atom.

Observations

Most of Matic Receivers were first time receivers.

The charts show a very outstanding jump in #Matic-receivers on Osmosis from DEC 20.

Also, 32% of users received 100-1000 Matic tokens in their first Maticreceiving transactions. under 10 is ranked 2nd with 30% , followed by 10-100 with 29% of first time receivers.

Conclusion

The incentives in driving liquidity made a very positive effect on Sending MAtic to Osmosis and as the outcomes show, a hype can be seen in the respected transactions and related stats.
In terms of MAtic transactions to Osmosis , Axelar is the network with the almost all of MAtic IN to Osmosis with 99% of all txns .
Most of users which have received Matic were first time receivers. but,mostly, the creation time of their wallets , were related to before incentives.
People like to Transfer ,swap and LP their received Matic respectively, as the first action after receiving it. Osmosis is their most popular token to swap for.

flipside