Osmosis is continuing on it's journey to list and incentivize all the major crypto assets it can get its hand on via Axelar. In this dashboard were going to take a look at the recent launch of Pool 1011 and the impact that the addition of incentives had on it.

This data is very interesting to justify decisions on future governance proposals on the chain.
More specifically ones regarding:

• Listing and incentivizing more assets
• Adjustment to incentives of existing pools

Have fun reading!

About the Author 👋

Hey I'm Playwo, 21, comp-sci student and enjoying data analysis.

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⏰ Low on time? Here are the facts!

• Before the addition of incentives activity in the pool was near 0
• Just after they were added users started to IBC in $ARB from Arbitrum using Satellite, around 70k $ARB so far.
• Over 80% of the $ARB supply is in LP, very little is just held
• The liquidity pool is highly centralized, the top 5 LPers (3.33%) control 66% of all liquidity
• In total just over 200 addresses interacted with $ARB in any way. 95% of those are LPers.
• Only 50 addresses currently hold a meaningful amount of $ARB on Osmosis
  (meaningful = 100+ $ARB)

📍 Conclusion & My opinion

Osmosis is currently spending 371 OSMO every single day to incentive liquidity providers in pool 1011. The data shows that those incentives were indeed necessary to provide a decently sized liquidity pool.

However even tho this pool now is large enough to offer low slippage swaps there is very little usage besides from liquidity providers and a handful of whales.

This is a common scheme across previous token launches, in general bridged tokens attract massively less users than IBC native tokens (Reference).

Especially given the bearish price action of $OSMO in the recent months I think incentives should be focused on pools that actually provide value to the ecosystem and making sure that the incentives for these pools are competitive. Osmosis is bleeding pool depths all over the board and especially IBC native tokens are being listed and better incentivized on more Cosmos DEXes.

The more pools receive incentives the less every single one can receive. This leads to a spiral where incentives are too low to be worth. Users quit, sell $OSMO, the price drops, incentives get even lower and so on.

In my opinion Osmosis needs to stop trying to please the handful of whales using these pools and instead focus on the average user.