Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money

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As DeFi incentives gradually lose their effect, those blockchains that can solve the “trilemma” begin to stand out.

Extended reading: “What is the public chain that Andre Cronje madly calls for orders?” Fantom Ecological Panorama Analysis”

Original title: “Nansen Data Analysis: How did Fantom rise? 》
Written by: Nansen
Compilation: Moni

introduce

Speed, security, and decentralization-are the three key elements surrounding the blockchain. It is also called the “Impossible Triangle” (Trilemma) of the blockchain. If you want to coordinate these three The relationship and gaining balance are considered impossible. However, with the arrival of Fantom, all this is being changed. Fantom was created to balance these three elements, aiming to lead the DeFi industry to solve this seemingly impossible problem.

What is Fantom?

Fantom is a highly scalable blockchain platform suitable for DeFi, crypto DApp, and enterprise solutions. It aims to break through the limitations set by the “old” blockchain by using the Lachesis protocol. This is a customized asynchronous Byzantine The fault-tolerant (aBFT) consensus mechanism, Fantom’s chain processing speed is faster, safer, and more scalable than those based on previous consensus algorithms.

In order to comply with the future multi-chain trend, Fantom has incorporated various chains into its network through bridging, such as Ethereum, BSC, Polygon and Avalanche. At present, major Ethereum projects such as SushiSwap and Curve have been migrated to Fantom, and traffic has also been introduced. On the other hand, SpookySwap-the first native income farming farm and AMM DEX on the Fantom chain-has gained great popularity, second only to AnySwap in the ranking of locked positions, and ahead of Curve and Beefy Finance.

Transaction and gas fees

Since the rise of DeFi in the summer of 2020, we have witnessed huge fluctuations in gas fees on Ethereum due to network congestion. The ever-increasing network demand forces users to bear too expensive transaction fees, and it is impossible to incentivize developers to participate in construction. From the figure below, we can see that in the past 2 years, the median Ethereum Gas fee has risen sharply, so there is an urgent need to expand the network and work out a solution compatible with Ethereum.

Above: The median price of Ethereum Gas fee (Gwei)

Although each network on Fantom is independently built at different scales, they have a common function, that is, to improve performance and reduce congestion. In addition, the Fantom mainnet uses the Ethereum Virtual Machine (EVM), which is compatible with Ethereum. This compatibility allows developers to migrate quickly and experience higher performance and lower costs.

As shown in the figure below, just after Fantom announced the launch of a $370 million liquidity mining incentive program in late August 2021, the number of transactions on Fantom surpassed Ethereum in September. At the same time, we found that the average daily gas cost on Fantom is much lower than that of the Ethereum network. This situation occurs because Fantom itself is built based on lower transaction costs.

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: ETH trading volume vs. FTM trading volume

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: Eth average daily gas cost vs. FTM average daily gas cost

Contract deployment activities

Contract deployment activity is an indicator to evaluate the effect of blockchain project development. Compared with Fantom blockchain, the level of contract deployment activity on the Ethereum blockchain is usually higher because there are currently more projects built on Ethereum.

The following figure shows this phenomenon more clearly, which shows the number of contract deployments on Ethereum and Fantom. We saw that in early June, the number of Ethereum contract deployments reached a peak, with more than 240,000 contracts deployed in one day. But since then, contract deployment activities began to decline and stabilized below 20,000 copies per day. On the other hand, after Fantom announced its liquidity mining incentive plan, its contract deployment activities surged in early September 2021, with a peak of approximately 12,800 contracts being deployed every day. It is worth noting that during this period, Fantom’s contract deployment activity was higher than that of Ethereum.

Another indicator worthy of attention is the contract deployment rate, which is calculated by dividing the contract deployment volume on Fantom by the contract deployment volume on Ethereum-we can see that the Fantom deployment rate has been increasing over time , And there are some peaks. During the period when Fantom’s contract deployment activities surpassed Ethereum, the ratio reached 1.26, which means that for every Ethereum contract deployed, 1.26 contracts will be deployed on Fantom. However, with the gradual increase in Ethereum contract deployment activities, the contract deployment rate has basically hovered around 0.1 recently.

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: Contract deployment activity FTM vs ETH

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: Contract deployment rate FTM vs ETH

Smart Money

If you are familiar with Nansen, then you should be familiar with our Smart Money wallet analysis label. Smart Money is an indicator tag of Nansen’s data analysis service. Other indicator tags include Smart LP, Flash Boys, Whales, Funds, etc. You can view the definition of related wallet tags here .

Smart money interaction can be regarded as one of the positive indicators for evaluating a certain project/agreement, because this indicator can clearly show the interest of experienced investors. Unsurprisingly, with the increasing popularity of Fantom and the migration of well-known protocols such as SushiSwap, Beefy Finance and Curve to Fantom, data shows that there are already a considerable number of Smart money addresses related to Fantom and Ethereum.

From the figure below, we can see that Flash Boys (a wallet that performs multiple DEX transactions in a single transaction, is an indicator tag for evaluating quick profits) has the largest coincidence rate on Fantom and Ethereum (up to 24.2%) . In addition, the three indicator labels of Smart LP, other wallets, and Funds all have overlap rates of 13.3%, 7.1%, and 0.9%, respectively.

If we compare these numbers with the numbers on the Binance Smart Chain, we can find that the Smart Money overlap rate on Fantom is much lower, which may imply that Fantom is still in the early stages of adopting Smart Money.

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: Distribution of Smart Money on FTM & ETH

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: Smart Money coincidence rate of different indicator labels

Stablecoin

On the Ethereum network, Tether (USDT) is currently the stable currency with the highest market capitalization and dominates the circulation of stable currency with a huge market advantage. In terms of trading volume, USDT’s trading volume is almost twice the sum of USDC and DAI. However, on the Fantom network, the dominant stablecoins are USDC and DAI, and USDT ranks third. This indicates that there has not yet been a dominant stablecoin market leader on Fantom. Therefore, we will pay attention to the future stablecoins in Fantom. On the performance will be very interesting.

On Fantom, USDC and DAI are in the leading position in terms of transaction volume. As shown in the figure below, USDC is far ahead in terms of transaction volume and average daily active users. From this, it can be seen that USDC is the preferred stable currency on the Fantom blockchain .

The soaring momentum of stablecoin activity on the Fantom blockchain indicates that its usage is gradually increasing, especially after Fantom announced its liquidity mining incentive plan in September, which caused an explosive growth in stablecoin activity that month. The increase in the number of stablecoins is a positive indicator because it means that there is sufficient liquidity on the Fantom chain, and users can adopt more complex strategies than the Ethereum mainnet, at lower costs and significantly faster speeds. However, in late September, when the entire cryptocurrency market was in decline, the stablecoin activity on Fantom also did not escape the fate of decline.

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: Fantom’s daily average trading volume of stablecoins on the chain

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: Number of senders of Fantom stablecoin daily active transactions

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: Fantom stablecoin daily trading volume

Value distribution of Fantom stablecoin trading volume

The average value of stablecoin transactions is a good indicator for evaluating Fantom’s user capital/wallet size. It can be seen in Nansen’s stablecoin backstage that over time, the value distribution of transaction size presents an interesting image (as follows As shown in the figure).

In September, the trading volume of stablecoins on Fantom was very large. Interestingly, the proportion of large transactions exceeding $100,000 has been on the rise. In addition, transactions of more than $1 million have consistently accounted for more than 90% of all transactions on the blockchain. This may be because of the incentives of the liquidity mining program, the capital began to pour in gradually.

Nansen analyzes the road to the rise of Fantom: contract deployment activities, stablecoins and Smart Money Above: The distribution of the number and value of stablecoins over time on Fantom

in conclusion

With the rapid growth of DeFi in the past 12 months, one of the biggest problems facing the industry today is whether the current infrastructure can keep up with the growing demand. At this stage, many Layer 1 and Layer 2 solutions have proposed many innovative methods and tried to solve various problems of blockchain running on traditional consensus algorithms. These solutions are fiercely competing for market dominance.

In order to attract users, the early versions of these solutions usually use liquidity mining incentives, but as these incentives gradually lose their effect, those blockchains that can solve the “impossible triangle” problem begin to stand out, and Fantom will become Is it one of the more popular Layer 1 in the future? Perhaps only time can give the answer.

Source link: www.odaily.com

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