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This week has highlighted the need for transparency & decentralization in crypto markets. Let's see how users have reacted to this wild week in Web3. Have behaviors changed? Analyze growth in Osmosis Volumes & User Count this week.
Introduction
what is osmo?
An enhanced automated market maker (AMM) protocol called Osmosis enables programmers to create unique AMMs with sovereign liquidity pools. Osmosis, which was developed with the help of the Cosmos SDK, makes use of Inter-Blockchain Communication (IBC) to allow cross-chain transactions.
Users of Osmosis may establish liquidity pools with special features like multi-weighted asset pools and bonding curves. Osmosis' reward system is also flexible. For certain pools, governance incorporates liquidity reward (LP) payouts, enabling strategically focused incentives.
Osmosis is an automated market maker for interchain assets that can be customized and was first introduced at a fair. It enables the construction and administration of non-custodial, self-balancing, interchain token indices similar to those offered by Balancer.
The purpose of Osmosis is to offer best-in-class tools that expand the usage of AMMs within the Cosmos ecosystem beyond conventional token swap-type use cases, and it was inspired by Balancer and Sunny Aggarwal's "DAOfying Uniswap Automated Market Maker Pools." Bonding curves' core use case is in decentralized trade methods, but Osmosis' customizability allows for further expansion of its possible use cases. Through Osmosis' flexibility to be customized in ways like custom-curve AMMs, dynamic swap fee adjustments, and multi-token liquidity pools, the AMM may provide the Cosmos ecosystem with decentralized token fundraising, interchain staking, an options market, and more.
While the majority of Cosmos zones have centered their incentive structure around the delegators, Osmosis aims to align the interests of different ecosystem stakeholders, including LPs, DAO members, and delegators. Staked liquidity providers are given sovereign ownership over their pools through the pool governance process, which enables them to change the parameters in response to competition within the pool and market circumstances. The sovereignty of Osmosis, a sovereign Cosmos zone, comes from both its application-specific blockchain architecture and the collective sovereignty of the LPs, whose interests have been aligned with those of the many tokens for which they are providing liquidity.
FTX
FTX was one of the world’s largest exchanges for digital money called cryptocurrency. FTX's problems worsened over the weekend and threatened the entire industry.
Sam Bankman-Fried founded FTX in 2019. He grew the trading firm quickly by attracting the biggest investors in Silicon Valley.
Last week, FTX declared bankruptcy. Bankman-Fried resigned. The firm said some money had disappeared. And experts say hundreds of millions of dollars may have been lost.
The collapse of FTX is a shock to the cryptocurrency industry, which has seen a fair number of problems this year.
Bitcoin, the world’s biggest cryptocurrency, has dropped about 65 percent in value for the year. And Ether, the world’s second most valuable cryptocurrency, lost 20 percent over the last weekend.
Why did FTX go bankrupt?
Investors fled FTX last week over fears about whether the firm had enough money. And FTX agreed to sell itself to another crypto exchange Binance. But the deal collapsed while Binance was researching FTX’s finances.
Last Friday, FTX and several connected companies filed for bankruptcy. The firm had valued itself between $10 billion to $50 billion. It listed more than 130 partner companies around the world, its bankruptcy filing said.
And Bankman-Fried who had rescued several cryptocurrency companies also resigned as chief executive of FTX.
Methodology
one challenge was locating all transferred assets and their symbol and pricing, so determined to utilize two price tables and manually modify their symbol. therefore I also use osmosis.core.dim prices in addition to
utilizing the aforementioned technique I could see most assets moved, including the low-volume ones. therefore the transfer volume charts are more accurate.
==perception==
Swap counts averaged 25,000 per day prior to the crash; on November 8th, they jumped to 43.8K and stayed at that level for three days.
In comparison to the daily average of $9M-$11M prior to the 8th of November, the swap volume increased dramatically. Moreover, the typical volume of swaps shot up to $544, up from $350.
No unusual rise in swappers was seen.
==perception==
The ratio of minor swaps (less than $10) declined while the percentage of large swaps ($100-$1,000) grew throughout the Collapse. the switch sizes increased
Sizes less than $10 made up 40.2% of all swaps one week prior to the collapse, while Sizes $100–$1,000 made up just 26.5 %. However, by week two after the collapse, the small size proportion had dropped to 32 %, while the $100–$1,000 range had risen to 35.6 %.
==perception==
Prior to the market crash, non-stablecoin trades made up the vast majority.
When the market crashed, the share of unstable coins dropped to 23%-28%. (but their number increased).
After the collapse, most days saw more exchanges into Stablecoins than out of them.
Interchange sizes increased following the market crash.
Previously, swaps away from stablecoins were larger in size, but with the collapse, swaps into stablecoins grew to become larger.
==perception==
The vast majority of IBC Transfers to Osmosis are made up of non-Stablecoins.
There are 8,000 daily transactions out of Osmosis on average, with just 300 of those being Stablecoins. The same holds true for Osmosis's incoming flow.
In the days leading up to the collapse, the outflow volume of stablecoins was significantly higher than that of non-stablecoins, but before the collapse, it was substantially lower. There was a huge increase in stablecoin volume, with $4.49 million being moved out of Osmosis.
conclusion
Swap counts averaged 25,000 per day prior to the crash; on November 8th, they jumped to 43.8K and lasted at that level for three days.
In comparison to the daily average of $9M-$11M before to the 8th of November, the swap volume increased dramatically. Moreover, the typical volume of swaps shot up to $544, up from $350.
The ratio of minor swaps (less than $10) declined while the percentage of large swaps ($100-$1,000) grew throughout the Collapse. the switch sizes increased
A large majority (42%) to a minority (47%) of pre-crash trades involved non-stablecoins. When the market crashed, the share of unstable coins dropped to 23%-28%. (but their number increased).
After the collapse, most days saw more exchanges into Stablecoins than out of them.
The size of swaps away from stablecoins was larger before the collapse, but the size of swaps into stablecoins grew to eclipse the size of swaps away.
Collapse-day transfers to Osmosis peaked at $8.11M on November 8th.
The vast majority of IBC Transfers to Osmosis are made up of non-Stablecoins.
In the days leading up to the collapse, the outflow volume of stablecoins was significantly higher than that of non-stablecoins, but before the collapse, it was substantially lower. There was a huge increase in stablecoin volume, with $4.49 million being moved out of Osmosis.
On November 8 and 9, approximately 66% and 57% of the total transfer volume to Osmosis came from Cosmos, making it the top Source for transferring assets to Osmosis on Collapse days.
