AAVE platform on Optimism
Introduction
- In this Analysis, You will read about the most popular project in all chains called AAVE. Previously, I analyzed AAVE on the Ethereum chain but Now it’s time to examine the AAVE platform on Optimism. I went through AAVE and Analyzed these parameters per Supply, Borrow, Repay and Withdraw:
- Users/Transactions
- Average/Total Volume
- Max/Median/min/Avg-7days moving volume
- Top Tokens Based on Volume
- Net Volume USD
- Avg Days of Holding Supply and Borrow
Analyzed by Hess - Reading Time Almost 12 Min.
Method
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I had a Supply transaction on the AAVE optimism chain. So I used my transaction and examined it to see how AAVE works. My transactions:
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I found AAVE has a contract address that handles all events like Supply, Withdraws, and …. I used the fact event table and put the AAVE contract address which is
0x794a61358d6845594f94dc1db02a252b5b4814ad as the origin to address filter. There are three unique events on AAVE. one is Mint and the other is Withdraw and the last is Burn. Mint is used for Supply and Borrowing, Withdraw with burn is used for withdrawal, and Burn is used for repayment.
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How did I separate Mint and Borrow transactions? I found that when the user supplies on AAVE, the User sends funds to the platform but when the user borrows a token, the Platform sends the user fund. Also, there is a difference between withdrawal and Repay. When the user withdraws its funds, Two events on AAVE are generated. Withdraw and Burn but when the user repays its borrow, Only Withdraw event is generated.
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Sample Code for Supply On AAVE:
supply_tx as ( select DISTINCT tx_hash from optimism.core.fact_event_logs where origin_to_address = '0x794a61358d6845594f94dc1db02a252b5b4814ad' and event_name = 'Mint' and block_timestamp::date >= CURRENT_DATE - {{N_Days}}) , supply as ( select 'Supply' as type, date(block_timestamp) as date, tx_hash , origin_from_address, contract_address as token, EVENT_INPUTS:value as raw_amount from optimism.core.fact_event_logs where origin_to_address = '0x794a61358d6845594f94dc1db02a252b5b4814ad' and tx_hash in (select tx_hash from supply_tx) and block_timestamp::date >= CURRENT_DATE - {{N_Days}} and event_name = 'Transfer' and origin_from_address = EVENT_INPUTS:from)
Volume Per Token
Supply: It seems USDC is the most popular token for Supply. The Volume of USDC is much higher than any other tokens. It is interesting because the second most popular token for Supply is DAI not USDT on AAVE Optimism. There were some days that USDT had more volume than DAI but on more days Users supplied DAI in comparison to USDT.
Borrow: USDC is the most popular and requested token for Borrow. In this case, DAI had a competition with USDC because some days, The DAI Volume was higher than USDC. I can see other tokens like OP, LYRA, PERP, or … but these tokens didn’t have much volume over time.
Withdraw: Withdraw follow the Supply path. Because of what users supplied they will withdraw that token too. Due to that, Stablecoins like USDC, DAI, and USDT are top tokens based on volume when users withdraw their funds.
Repay: Repay comes after the Borrow. In this part, USDC, DAI, and USDT are popular too. What is different from other charts is that sUSD is more popular than WETH and WBTC. The volume of sUSD increased over time.
Net Volume
- In order to understand the chart better, I changed the daily chart to the weekly chart. I put the total supply and withdrawal volume and calculated the Net Volume. For Almost 8 weeks since August 2022, The AAVE net volume was positive and for almost 6 weeks, The net volume was negative. The highest negative net was the second week of August which was 328M US dollars. The highest net volume was October 24 with 377M US dollars.
Holding Days
- In platforms like AAVE, the number of days that users hold their funds on the platform is very important. The average number of days holding Supply or Borrowing increased over time. The average days of holding since Borrow and Repaying is 21 days and the average days of holding since Supplying and withdrawing is 17 days. Right now the average days increased to 38 days for both Borrow and Supply.
ALL CODES AND CONTENTS WERE WRITTEN BY HESS.
:bird: Twitter: @hessaminanloo
:flying_disc: Discord: hess#0890
:calendar: Analyze Date: 2022/NOV/11
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What is AAVE platform?
- Aave is a decentralized finance (DeFi) protocol that lets people lend and borrow cryptocurrencies and real-world assets (RWAs) without having to go through a centralized intermediary. When they lend, they earn interest; when they borrow, they pay interest
What is the Optimism Chain?
- Optimism is a fast, stable, and scalable L2 blockchain built by Ethereum developers, for Ethereum developers. Built as a minimal extension to existing Ethereum software, Optimism's EVM-equivalent architecture scales your Ethereum apps without surprises.
N_days is a time frame Parameter. Feel Free to change date by changing the number of days and then, click on ‘Apply All Parameters‘. 90 Means in the last 90 days.
Full Analysis
Transactions and Volume
- Borrowing is the most popular feature of AAVE. The borrow event had the highest number of unique users in the last 90 days. Between October 5 and October 18, The highest number of users borrowed assets from AAVE.
- I searched for the reason that some days, The total number of Borrow and Supply increased more than the other events. I found the Layer3 platform that had AAVE tasks for Optimism and Polygon chains during October and November. Due to that, Lend (Supply as collateral) and Borrow activities had more users on some specific days and were different from normal days.
- Overall, fewer Users Repay their borrowed and withdraw their assets from AAVE.
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With 52% of transactions, Half of the total AAVE transactions were Borrow in the last 90 days.
- Over time, the user’s activities didn’t change too much on AAVE. But there were some ups and downs.
- It seems The only event that changes the share of other events is Withdraw. Because supply, Borrowing, and Repay are related to each other, and like chains, they are coming after the other. I mean when the User Supply on AAVE, The next action would be to Borrow and After borrowing, The next action is to Repay. Withdraw not coming after them.
- At the beginning of August and Late October, The daily share of withdrawing increased up to 26% But on other days was between 10 and 15%.
The highest volume in USD is related to the Supply events. The total Supply volume is 1.8B US dollars in the last 90 days.
- Since August 2022, Users borrowed 1.4B US dollars, Repaid nearly 950M US dollars, Withdrew 1.6Band Supplied 1.8B US dollars.
- The highest volume withdrew from AAVE on August 18. Users withdrew around 286M US dollars on AAVE.
- Between September 15 and October 16, The daily volume of all events decreased but Again After October 16 with the help of Layer3, the volume increased.
- The lowest volume went through Repay.
Transactions
- Since October, The growth of Borrow based on transactions was higher than other events. After borrowing, The highest growth is related to Supply transactions.
Volume
- The Growth of Events based on Volume changed over time. Until October 15, The highest volume was for Withdraw but after that Supply took Supply place and became the first activity based on volume. Also, Borrow activity became the second place for a short time after its huge growth in late October.
Withdraw activity had the highest average volume with 75K US dollars.
- There were too many ups and downs for each activity. The lowest average was in October and the highest average was in the middle of August. Recently, The average volume of borrowing dropped from 244K to 3K. Meantime, The average volume of Withdraw increased and reached up to 550K US dollars.
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- In the middle of August 2022, The average daily 7-day moving volume of Repay and withdraw was much higher than Deposits and Borrows. The difference was too much. But in late August, The average decreased and became similar to other activities.
- After a short time, The average 7 days moving volume of Withdraw decreased, and instead of that, the Borrow averagely increased and became second place.
- The lowest average for Supply, Withdraw, Borrow and Repay was Between September and October 10. A Day after, the Supply and Borrow Average increased significantly until November. Then Withdraw became on the top list with 48M US dollars and Borrow dropped to 1.3M from 40M.
- I analyzed Symbols of inflow and outflow volume. The total Supply and withdrawal of USDC, sUSD, and DAI match and it’s positive. But USDT, WBTC, and WETH are negative. In the last 90 days, more volume of USDT, WBTC, and WETH withdrew in comparison to Supply. On the other hand, More volume is supplied for DAI and USDC in comparison to Withdraw.
Conclusion
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The short conclusion for AAVE is that they are doing great. In my opinion Optimism chain is one of the most popular chains for AAVE. They Could attract nearly 1.6B US dollars in 90 days.
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AAVE borrowed around 1B US dollars. However, Users made their own collateral. But Parameters show they are growing on the Optimism chain and it seems soon become one of the top projects on the Optimism chain.