Defi Activities

I used to filter Defi and Dex transactions to find transactions on Solana Defi Ecosystem.

1. The number of daily Defi transactions decreased after the FTX crash on November 8, as there were less than 500K daily transactions over the past week.
2. The average number of transactions also decreased from 6.8M before the crash to 1.8M after.
3. On November 9, one day after the crash, 36.435K unique users transacted on Solana Defi Ecosystem, which is the maximum number in November.
4. The number of Defi users started to grow since the crash, but after November 10, the number of users began to decrease to before the crash.
5. The average number of users increased from 13.68K, before the crash, to 15.3K, after the crash.

Defi Activities per Platform

1. As mentioned above, there was a considerable decrease in the average number of transactions on Defi programs after the crash.

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2. The Serum had a significant share of total Defi users before the crash, with 72.1% of transactions and 22.7% of users, which decreased to 43.8% of transactions and 21.6% of users after the crash. But still has the first rank in transaction count.

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3. According to the above charts, After the FTX crash, Serum's share of transactions and users has experienced a decrease, while on other Defi platforms like Zeta, Jupiter, and Solend, the share of transactions and users has experienced a rise, which shows users are moving from Serum to other Defi programs.

CEX inflows and outflows

1. In terms of the number of transfers, the above charts show a sudden increase in CEXs Outflows and Inflows from the Solana ecosystem since the FTX crash, as the maximum number of CEX transfers was on November 9 and the maximum number of volume was on November 7.

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2. The volume of USD inflows and outflows from CEX suddenly increased on November 7, the crash day, before it declined to its pre-hack level on the following days. However, another sudden increase happened on November 18, on which Binance had the greatest share.

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3. In terms of the volume of transfers, the average USD volume of CEX transactions has decreased after the crash, while there is no significant change in the average USD volume of transactions to CEXs.

Effect of Openbook on Solana Defi

1. Using the above charts, it is clear that the effect of Openbook started to increase since the Serum fork on November 12, as the point that Openbook has had the greatest share of transactions since November 12 with 37.1% of transactions.
2. Also, the increasing trend on Openbook can be seen in the case of daily users, but it is less evident than the share of Openbook on the number of transactions.

Staking Activities

1. Based on the above charts, unstaking activity on Solana was impacted significantly by the FTX crash since there is increasing withdrawal activity specially on November 10. But the for the staking activity, there is no specific increase in the delegated amount after the crash.
2. The average number of delegates increased from 1K before the crash to 1.83K after.
3. Still, the most significant number of staking and unstaking transactions belongs to after the FTX crash.

Staking Activities per Pools

1. According to the data above, the Marinade and Lido stake pools accounted for the bulk of Stake and Deposit activities since the November by number and USD volume of transactions.
2. The November 8 and 9 saw a significant increase in stake activity, however, the number and volume of stake actions on pools have since started to decline.

Conclusion

• After the FTX crash on November 8, daily Defi transactions dropped to less than 500K. Average daily transactions dropped from 6.8M to 1.8M. One day after the incident, 36.435K unique users transacted on Solana Defi Ecosystem. After November 10, Defi users began to fall to pre-crash levels. But, after the crash, average users rose from 13.68K to 15.3K.
• After the crash, Defi program transactions decreased. The Serum had 72.1% of Defi transactions and 22.7% of users before the crash but just 43.8% and 21.6% after. Serum's proportion of transactions and users has decreased since the FTX crash, whereas Zeta, Jupiter, and Solend have seen increases. This shows that users are transferring from Serum to other Defi systems. So, we can conclude that Defi on Solana is becoming more decentralized.
• Since the Serum fork on November 12, Openbook has had 37.1% of transactions. Also, Openbook's daily user base is growing, albeit less so than its transaction share. 
• The most significant number of CEX transfers was on November 9, while the maximum number of volumes was on November 7. The volume of USD inflows and outflows from CEX rose on the crash day, November 7, before declining to pre-hack levels. On November 18, Binance's share jumped again. The average USD volume of CEX transactions has reduced since the crash, whereas the volume of transactions to CEXes has not changed significantly.
• The FTX crash significantly reduced Solana's unstaking activities, notably on November 10. After the crash, the number of staking transactions stayed the same. Before the crisis, there were 1,800 delegates on average. After the FTX crash, the greatest staking and unstaking occurred.
• Marinade and Lido stake pools accounted for most Stake and Deposit transactions since November. On Nov. 8 and 9, stake activity increased. However, pool stake actions have declined.

Methodology

• We will use the Solana.core.fact_transactions, Solana.core.fact_transfers, and Solana.core.fact_staking_lp_actions tables to find out how Solana Defi has responded to the risks that Serum suddenly presented and whether there has been any traction on Openbook so far.

• We will analyze how liquidity has flowed through Solana Defi and what programs were most affected by the replacement of Serum. 

• And finally, we will discuss whether Defi on Solana is becoming more decentralized.

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Serum fork after the FTX hack

• Solana’s developers forked the widely used token liquidity hub Serum after being compromised by a hack on the bankruptcy exchange FTX on Nov 11 that led to a series of unauthorized transactions. 

• According to pseudonymous developer Mango Max on Twitter, a “verified build of the same version has been made and deployed” on Nov 12. Additionally, the upgrade authority and fee revenues “have been changed and are now managed by a multi-sig controlled by a team of trusted developers.” Serum (SRM) and MegaSerum (MSRM) tokens and fee discounts were not changed and were working as before.

• The development took place on the weekend. Solana co-founder Anatoly Yakovenko tweeted that developers depending on Serum were forking the code after the upgraded key was compromised, adding that many “protocols depend on serum markets for liquidity and liquidations.”

• In a Twitter thread, Mango Max said that the Serum update key was not controlled by the Serum decentralized autonomous organization (DAO) but by a private key connected to FTX, and no one could confirm who controlled the keys. The private key was necessary to update the original version of Serum, leading the developers to fork the code, as the private key is under FTX control. 

• Mango Max also noted that:

  “When I reached out to a couple of people previously involved with Serum, I got answers like: ‘I wish I had more info to help you, but I don’t.’”

• Liquidity providers such as Jupiter, the most popular aggregator on Solana, confirmed turning off Serum as a liquidity source “due to security concerns about upgrade authorities. We also encouraged all our integrators to do the same.” Other projects, such as Mango Markets and SolBlaze, also announced integration with the new fork.

• As reported by Cointelegraph, an attack led to $659 million in outflows from FTX and FTX US on Nov 11. FTX US general counsel Ryne Miller confirmed later that the transactions were unauthorized and that FTX US had moved all remaining crypto into cold storage as a precaution.

• A blog post from blockchain forensics firm Elliptic suggests that the drain has seen various tokens on Ethereum, BNB Smart Chain, and Avalanche removed. Of the $663 million drained, around $477 million is suspected of having been stolen, while the remainder is believed to have been moved into secure storage by FTX.