Continued Growth?

    Introduction

    • In this Analysis, You will read about the Growth of Three popular Layer 2 chains. Optimism, Arbitrum and Polyogn.

    • According to Cointelegraph, "Ethereum layer-2 networks, such as Polygon, Arbitrum, and Optimism, have experienced explosive growth over recent months, a trend that is expected to continue in 2023."

    • There has been an increase in daily active users, volume traded, and more.

    • Does this growth look set to continue into next year? Will L2 growth slow down as 2023 progresses?

    Analyzed By Hess - Reading Time Almost 10 Min.

    About Chains

    Loading...
    Loading...
    Loading...

    Transactions and Users

    My second comparison is based on Transactions and Active Wallets on Optimism, Arbitrum, and Polygon.

    • Each chain has seen an increase in transactions since September 2022. From September through August, Polygon had 18-19 million transactions per week, but after November, that number increased to 20-21 million.
    • Arbitrum and Optimism had the highest growth rates. After October, arbitrum transactions increased to 5M per week from less than 1M in September and August. Furthermore, weekly Optimism transactions were below 1M during November but 2.5M during December.
    • In late October, Polygon experienced a huge increase in unique users. Before October, there were fewer than 1 million weekly users. In October 2022, Polygon's weekly users reached 2.2 million. The number of users on Polygon has doubled.
    • I cannot see sufficient growth on Arbitrum and Optimism until October 2022, but this metric significantly increased after October. As of the beginning of the new year, over 250K users were on Optimism and Arbitrum.
    Loading...
    Loading...
    Loading...
    Loading...
    Loading...
    Loading...

    Growth Percentage


    Percentage is the best way to measure growth. My calculations showed that Polygon, Arbitrum, and Optimism have grown in transactions and users.

    • Based on percentage growth, Arbitrum had the highest growth during August, September, and October. Then, Optimism saw the highest growth, while Polygon remained relatively the same. A negative percentage was only seen in Polygon during September.
    • The average number of transactions on Arbitrum increased by 48%, compared to 26% on Optimism and 1.9% on Polygon.
    • On average, optimism grew by 21% per month. The average growth for Polygon users was 19%, while the average growth for Arbitrum users was 12%.
    Loading...
    Loading...
    Loading...
    Loading...

    Swap Activities

    • Now it's time to examine swap transactions and trade volumes. Again, I should mention that swap activities are based on swaps to ETH on optimism and Arbitrum and Matic on Polygon. US dollars are used in this calculation.
    • Similar to previous parameters, you can see good growth on average. After the new year, optimism swaps increased by 80-90% compared to September. The growth of Arbitrum is pretty obvious.
    • Until October, the number of swaps was 100-400K but then increased to 1M. It decreased after a short time but remained higher than in September.
    • A total of 52% of swaps took place on Polygon, 24.4% on Arbitrum, and 23% on Optimism.
    Loading...
    Loading...
    Loading...
    Loading...
    Loading...
    Loading...
    Loading...
    Loading...
    Loading...
    Loading...

    NFTs sales

    I should mention that NFTs on Polygon is just getting started. This chain has a lot of potentials. Solana and other chains are bringing some popular collections to Polygon soo. A chain can benefit from NFTs as much as any other transaction. Compared to other activities, the NFT industry can be a serious competitor.

    Conversely, Optimism and Arbitrum had a great start but haven't succeeded yet. Despite many collections on these chains, the average NFT price is not too high. Recently, some collections on Arbitrum became popular.

    Optimism and Arbitrum, two popular marketplaces, have recently merged with Opensea. It's not because they weren't successful. This is because Opensea is doing well compared to all other marketplaces.

    Loading...
    Loading...
    Loading...
    Loading...
    Loading...
    Loading...

    Polygon has a higher average NFT price than other chains. On Optimism, the average price is 11 dollars and on Arbitrum, it is 13 dollars. Moreover, Polygon's total sales volume differed greatly from other chains. You may hear about Reddit collections on Polygon, which generated a huge volume.

    There are 62% of NFT transactions on Polygon, 21.5% on Optimsim, and 15.9% on Arbitrum.

    Conclusion ( Continued Growth )

    The short answer is yes. They will continue to grow. Why? Here are some reasons why I believe they will continue to grow.

    • Polygon: NFT market leaders were Ethereum and Solana. In the wake of the FTX crash, the Solana NFTs didn't change much, but many new collections are considering moving from Solana to Polygon. Polygon made so many contracts with non-web3 companies so they could bring utility into their chain. Like what they did with Starbucks and Reddit.
    • Optimism: The OP token price has increased 3-4x in the last month, showing the potential of this chain. Many new platforms have been launched based on the Optimism chain, and those projects are popular across all chains.
    • Arbitrum: There are different conditions for Arbitrum. Considering the products that work under Arbitrum, I would say they are the most powerful chain. Projects Like GMX. But we can't talk about Arbitrum right now. Due to Arbitrum's airdrop, many activities were conducted through them. Let's wait until their token launch to see if they can move like Optimism. Having a powerful token and unique products under the Arbitrum chain, I believe they will continue to grow

    Note: I didn’t show OP and Matic's price because Arbitrum doesn’t have a token, and the comparison without Arbitrum is not interesting.

    db_img
    db_img
    db_img
    db_img

    Polygon:

    • It is a Layer 2 blockchain designed to increase Ethereum's scalability. The purpose of Polygon is not to duplicate Ethereum's functionality as a Layer 2 protocol. As a result, developers can achieve faster transaction speeds and lower costs.

    Arbitrum

    • The Arbitrum technology is also known as optimistic rollup. By sending messages between Ethereum main chain smart contracts and Arbitrum second layer smart contracts, it allows Ethereum smart contracts to scale.

    Optimism

    • This blockchain was built by Ethereum developers, for Ethereum developers, to be fast, stable, and scalable. As an EVM-equivalent architecture built on top of Ethereum software, Optimism scales your Ethereum apps without causing surprises.

    Method

    New Users

    We Don’t Have access to the wallet creation date. So, I extracted the first transaction date of each user. Then, Based on the first transaction’s date, I counted the number of users. New users are based on the Transaction table.

    Transactions/Users

    I used the Fact transaction table for each chain and counted the weekly number of transactions and users.

    Swap

    We don’t have Arbitrum and polygon tokens prices. So, For this part, I analyzed swap activities to ETH or Matic tokens. I extracted all event names from the Event log table with Swap input. Then, I joined My finding to ETH and Matic transfer tables on Optimism, Arbitrum, and Matic.

    NFTs

    Opensea is the largest marketplace on Optimism, Arbitrum, and Polygon. I found the Opensea contract address on each chain and calculated the NFT volume by ETH price. For Polygon, I added All sales with DAI tokens too. Quix and Stratos are two native marketplaces on Optimism and Stratos. In my findings, I include sales on these markets too.

    Full Analysis

    New Users

    First, let's discuss new users on Arbitrum, Polygon, and Optimism. The number of new users is based on the first transaction of each user on these chains.

    • Compared to Arbitrum and Optimism, the total number of users and transactions is much higher. Optimism and Arbitrum each had 1 million new users, while Polygon had 14.3M. The share of new users on Polygon is 85%. The percentages are 8% for Arbitrum and 6% for Optimism.
    • Recently, Optimism appears to have grown faster than Polygon and Arbitrum in terms of new users. Sufficient growth was seen in each of the three chains in October 2022. The number of new Polygon users per week was 388K before October, but it increased to 1.5M during October. Optimism and Arbitrum had 13K and 33.5K new users at the start of October, but these numbers increased 3x by the end of October.
    • There wasn't much change in Polygon New users after October, but Optimism and Arbitrum had better growth rates.
    • September was a pretty busy month for Polygon in terms of transactions. Arbitrum users had the lowest average number of transactions during that period. Optimism and Arbitrum users' average number of transactions increased weekly, while Polygon users' average number decreased.

    • Arbitrum users recently made an average of 19 transactions per month. This is a trend on Arbitrum Airdrop. As a result, more users like to have transactions on that chain in order to increase their chances of getting an Airdrop.

    • In the past six months, Polygon had 16.5 million unique users, Optimism 1.2 million, and Arbitrum 1.8 million.

    • Arbitrum had 16.6 transactions per user, Optimism 14.6, and Polygon 14.9.

    \

    Trade Volume


    • Arbitrum among these chains recorded the highest swap volume. Arbitrum does not have its own native token, as I mentioned earlier. Arbitrum is seen by users as a potential way to increase their chances of receiving an Airdrop.

    • Despite the ups and downs for each chain in the last six months, you can see growth after the new year.

      Arbitrum has an average swap volume of 489 US dollars per user, Optimism 441 dollars, and Polygon 211 dollars.

      Each chain continued to grow and they just started!

    THANK YOU FOR READING!

    ALL CODES AND CONTENTS WERE WRITTEN BY HESS.

    :bird: Twitter: 0xhess

    :t-rex: Discord: hess#0890

    :calendar: Publish Date: 2023/FEB/03