Osmosis & Stride
Introduction
In this Analysis, You will read about stOsmo. stOsmo launched in November 2022. We want to know How has Stride's LSD stOSMO impacted validators in the active set?
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Track the impact of undelegations & transfers to Stride. Which validators were the most impacted by stOSMO?
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Have the validators most impacted by undelegation received ample delegations from the Stride ICA? I went through the new stOsmo and analyzed these parameters:
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stOsmo Transfers
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Delegate/Undelegate by stOsmo Users
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stOsmo/Osmo Pool
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Analyzed by Hess - Reading Time Almost 8 Min.
What is stOsmo?
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Virtually all Osmosis pools have a phenomenon called "impermanent loss," which, as the name suggests, can result in liquidity providers losing money. But not the new stOSMO / OSMO liquidity pool. With the stOSMO pool, you're constantly 100% exposed to OSMO, just as though you were staking OSMO. This means no impermanent loss. But the yield on the stOSMO pool is much better than the plain old OSMO staking yield.
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OSMO staking yield = 23% APR, whereas the stOSMO pool APR is currently over 200%!
Due to its lack of impermanent loss and high yield, the stOSMO pool is great for beginners (but also everyone else who loves yield). Here's a quick and simple tutorial on providing liquidity for the stOSMO Osmosis pool.
Source:
stOsmo Users Activities on Osmosis
The main reason for this analysis is stOsmo users on the Osmosis chain. Before I examine The total delegation and undelegation, I analyzed the first activity of stOsmo users when they landed on the Osmosis chain.
- Overall, 48.6% of the first stOsmo users on Osmosis transactions were swapping. The second top activity was a transfer, with 29.7% of total transactions. The third top activity was Liquidity was 14.1% of total transactions.
- The daily share of transactions show so many ups and downs since October 31. On some days, Transfer and Liquidity had higher shares, and on others, swap transactions had higher shares. It means when stOsmo landed on Osmosis, They use Swap, Liquidity, and Transfer.
Pool 833 stOsmo/Osmo
I analyzed the Liquidity activities on Pool 833 (stOsmo/Osmo). For this part, I examined all users of Osmosis, not only stOsmo Users.
- The stOsmo/Osmo pool size is 2.35M US dollars.
- The total Add Liquidity transactions are 91.1%, and the total removes Liquidity is 8.86%.
- Until December 21, The daily share of Removed Liquidity transactions was below 25%, but after December 21, The daily share of Add Liquidity transactions decreased, and Remove Liquidity transactions increased. The share of Remove Liquidity increased from 10% to 61% on December 31.
- Until December 26, The total added Liquidity was much higher than the removed liquidity amounts. But after that, The removal amounts increased. However, The total added Liquidity still was higher than the removed Liquidity.
Delegate/Undelegate by stOsmo Users
The main reason for this analysis is about Delegation and Undelegation by stOsmo users on the Osmosis chain. It’s time to examine this activity by stOsmo users and find which validators are impacted most by these users.
- The important part about Delegation and Undelegation is the amount of delegated and undelegated, not the number of users or transactions. But before we examine the total amount, I look at the number of users first, then, I examine the total amount.
- Overall, The total delegate was 98.9% of the total stOsmo users, and the total number of undelegate stOsmo users was 1.1%. Fewer users undelegate on Osmosis. Almost from November until January 2023, The total daily number of delegate users didn’t change.
Conclusion
- Users Transferred 266K stOsmo from Osmosis to Stride and other chains. Also, Users Transferred 1.8M stOsmo to Osmosis.
- 88.5% of transactions were to Osmosis, and 11.5% were from Osmosis.
- The highest activity by stOsmos users when they landed was Swap, and after that was the transfer.
- The top swapped token from and to stOsmo was Osmo.
- Based on delegate/undelegate by stOsmo users, 98.9% of users delegated and only 1.1% of users undelegated.
- The total delegated amount was 808K Osmo, while the total undelegated amount was 2.7M Osmo.
- Chorus One and Figment validators were impacted most by stOsmo users. About 96% of the total undelegated amount was from these two validators.
- The stOsmo/Osmo pool size is 2.3M US dollars.
- 91.1% of transactions added liquidity to that pool, and 8.86% removed liquidity.
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What is Osmosis?
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Osmosis is Layer-1, Proof-of-Stake (PoS) blockchain built using the Cosmos SDK that has optimized its design to be a sandbox for automated market makers (AMMs). The chain enables developers to design and deploy customized AMMs by using its various modules and leveraging Osmosis' on-chain governance system.
Source:
Method
I divided my analysis into three categories: 1. stOsmo Transfers 2. Delegate/Undelegate and Validators 3. Liquidity on stOsmo/Osmo
- stOsmo Transfers
- First, I found the stOsmo contract address, ibc/D176154B0C63D1F9C6DCFB4F70349EBF2E2B5A87A05902F57A6AE92B863E9AEC. Then, I used osmosis.core.fact_transfers. I put the stOsmo contract in the currency column. All transactions with the IBC_TRANSFER_OUT transfer type are transferred stOsmo from Osmosis, and all transactions with IBC_TRANSFER_IN are transferred to Osmosis.
- stOsmo amount has a decimal. With the
pow(10,6)
function, I extracted the actual transferred amount.
- Delegate/Undelegate by stOsmo Users
- First, I extracted All stOsmo receivers on the Osmosis chain. All staking activities were recorded on osmosis.core.fact_staking table. I examined stOsmo activities on that table. Delegate action is staking, and Undelegate action is Unstaking.
- To see which validators were impacted most by stOsmo users, I combined the validator address into DIM Lable tables and extracted Validators' names. I tracked all undelegates by stOsmo users from validators. Based on total undelegated amounts, I found the top impacted validators.
- Liquidity
- From the Osmosis zone website, I searched stOsmo/Osmo. I found the pool number, which is 833. From osmosis.core.fact_liquidity_provider_actions table, I examined all add/remove liquidity on that table. For the Pool size section in USD, I used the #JacktheGuy Method.
Full Analaysis
stOsmo Transfers
As I mentioned, I tracked all activities of stOsmo from and to the Osmosis chain. Let’s see when stOsmo launched on October 31 and how users transferred this token. From Osmo and To Osmo means Osmosis chain, not Osmo token.
- The total daily number of users shows a trend that went through the Osmosis chain. It means users transferred their stOsmo to the Osmosis chain more than transfers from it. The highest number of users was between November 1 and November 20.
- The highest number of users transferred their stOsmo to Osmosis on November 1. On that day, About 262 unique wallets transferred their stOsmo to Osmosis. After that time, The total daily number of users decreased to under 25 unique wallets. Again, On November 23, The total daily number of unique wallets increased to 155. From November 23 until now, The total daily number of users didn’t increase, and users were below 20. Fewer users transferred their stOsmo from Osmosis. Overall, 342 Unique wallets were transferred stOsmo From Osmosis and 2480 Unique wallets were transferred to Osmosis.
ALL CODES AND CONTENTS WERE WRITTEN BY HESS.
- From October 31 until December 12, almost 70% of transactions were transferred stOsmo to the Osmosis chain. But after that time, For ten days, The daily share of transactions from Osmosis increased to 75%, but after that, The daily share of the To Osmosis chain increased again.
- Overall, 88.5% of transactions were transferred stOsmo to Osmosis, and 11.5% of transfers were from Osmosis.
So Far, I have examined the total number of transactions and users that transferred stOsmo to Osmosis and vice versa. Now, It’s time to examine the total daily transferred amounts. The Total and daily transferred amounts in the below charts are based on stOsmo.
- Users transferred 266K stOsmo from Osmosis and about 1.8M stOsmo to Osmosis. The transferred amount to Osmosis was 9x higher than transfers from the Osmosis chain. Obviously, The trend is going through Osmosis.
- The highest daily transferred amount to Osmosis was between October 31 and November 10, but the highest amounts from Osmosis were between December 23 and January 2.
- The highest transferred amount was 279K stOsmos on January 5, 2023.
We already know that users transferred stOsmo to the Osmosis chain more than transfers from Osmosis.
- The average transferred stOsmo to Osmosis was 24K, and the average transferred amount from Osmosis was 4.1K stOsmo. The average daily transferred amount to and from Osmosis increased from December 15 until January 5.
In the previous chart, You had seen that swap was the top popular activity by stOsmo users when they landed on the Osmosis chain. I tracked top swapped tokens from and to stOsmo token.
- The top popular tokens based on the total number of transactions are Osmo, Atom, and USDC from and to stOsmo.
So, we already know that the total number of delegate users was much higher than undelegate users, but when we talk about the undelegate amount, You can see how numbers changed. I should mention that the amount is in Osmo.
- Overall, stOsmo users delegated 808K Osmo and Undelegated 2.87M Osmo. The delegated Net is around 2M Osmo.
- The highest amount of Undelegate happened On November 27 when stOsmo users undelegated 2.5M Osmo. Almost 90% of total delegated amounts.
- Before and after November 27, The total daily undelegate and delegate amount were below 50K.
Which Validators were impacted most by stOsmo users?
- stOsmo users undelegated 1.75M Osmo from Chorus One validator. The share of this Validator was around 61.9%. So, The most impacted validator by stOsmo users was Chorus One.
- The second top Validator was Figment. stOsmo users undelegated 777K Osmo from Figment validator. The share of this validator was around 27.5% of total undelegated amounts. Besides these two validators, The total undelegate amount from other validators was below 60K, which wasn’t unusual.