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The Block research analyst found some highlights from the Ethereum address of Wintermute, one of the largest market makers in the cryptocurrency market.
Written by: Igor erdiev, Research Analyst, The Block
Translation: Lu Jiangfei
Wintermute has become one of the largest market makers in the current cryptocurrency market . According to the current monthly trading volume data, Wintermute has become the first market maker on Bitfinex , and it is also very popular on the crypto derivatives exchange FTX . active. In addition, in 2020, Wintermute will account for approximately 40% of transaction volume on dYdX. (Extended reading: “Pantera Partners: Understanding the Cryptocurrency Market Maker Wintermute” )
Next, let’s see if we can find some highlights from the Ethereum address of Wintermute.
First, let’s start with the interactive address between Wintermute and dYdX, which currently has approximately $3.4 million in liquid funds. In addition, the address is currently farming ARMOR tokens, using ARMOR to provide liquidity to the Uniswap pool. The “interesting” thing is that we discovered that this address once spent 0.2 ETH to purchase counterfeit LON tokens.
Next is Gnosis’s multi-money address, which holds $7 million in Uniswap LP tokens. Now, we know that Wintermute is the only liquidity provider (LP) of the three liquidity pools wCUSD, wCELO and renFIL on Uniswap. In addition, Wintermute’s Gnosis multi-currency address also contains 132,000 PERP tokens, 60,000 LON tokens, and 237,000 TRU tokens, with a total value of approximately US$1.4 million.
One of the most important components of Wintermute’s infrastructure is the DEX robot, which has at least two versions. Although the early version of the DEX robot has been abandoned, the robot address still holds two LP tokens, Mooniswap and 1inch V2, valued at approximately US$ 18,000 .
Wintermute’s new version of the DEX robot has nearly 35 million U.S. dollars in funds and purchased SNX tokens worth 1.2 million U.S. dollars. At this stage, no signs of using MEV for the new version of Wintermute’s DEX robot have been found, but we have noticed that the robot is using a sub-optimal gas price bidding strategy. From this perspective, Wintermute still has room for improvement in terms of increasing the rate of successful transactions and reducing fees.
It is worth mentioning that, at least in the early stages, Wintermute is still one of the largest market makers on TokenIon. We believe that Wintermute should still be a market maker on TokenIon. The main goal of the second version of the DEX robot is to combine the market maker function with DEX trading.
The core address of Wintermute is mainly responsible for transactions between CEX and DEX robots. Although we can identify and analyze the Wintermute deposit address, we still cannot reliably estimate its asset value, because the tokens are usually transferred directly to the CEX hot wallet after deposit.
Cryptocurrency exchanges that currently use Wintermute market makers include:
-Coinbase (AAVE, BAL, BNT, DAI, LINK, MKR, SNX, WBTC, UNI, USDC, YFI, totaling approximately USD 6.31 million)
-Coinlist (95,000 USD)
Based on the above exchanges, we estimate that Wintermute has at least $55 million** . They control almost all renFIL, wCUSD and wCELO tokens, and they bear most of the trading volume on dYdX and TokenIon. Finally, due to the deployment of DEX robots, it is not an exaggeration to call Wintermute a “ Advanced Market Maker**”.
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