On May 11th and 12th we saw a spike in number of swaps and volume across the DEXs. Breakdown what happened? What were users swapping from and to?

• Were users swapping from ALGO to stables?

  • Was the average swap size bigger than normal? Is this tied to the price of ALGO?

• Help us understand what took place and why the volume and number swaps increased!

Intro

Algorand like the entire cryptomarket has had a downtrend year, and in may, 11 to 12 it touch bottom price. That caused a huge spike in movements inside the Algorand Blockchain

Method

• Analysing price trends and swapping activity inside Algorand network, we can see what occurred during this price rebound.

Analysis

Swapping Amount

Tasks

• ALGO has been in a price downtrend since last year excepting the period close to end of 2021.

• Price was trying to turn against the downtrend but in may, 9. It started to fall again.

• Now, with prices at a level not seen since January, 2021. Price appears to have found a resistance level marking the bottom of the price fall.

• This tends to spike incoming flux into all blockchains and in this case, Algorand.

• The levels during may remained particularly leveled considering the downtrend in ALGO price at the start.

• But, when price appears to have bottomed activity levels rised up

• The preferred tokens to exchange during the spike were ALGO, USDC, STBL, USDT, and Yieldly.

• Excepting ALGO, swaps consisted mostly of defi tokens.

• The amount of ALGO swapped for stablecoins did rise during the spike, in all stablecoins.

• Particularly Algorand based stablecoins, like STBL and GARD, with two times the average swap for STBL and four times for GARD.

• USDC remains with the largest amount of ALGO destined, it grew by more than 100 ALGOs per average swap.

• USDt and rUSD saw spikes in average volume but still remaining in the lowest amounts.

• The days before the spike the largest average swap was 721 ALGO to USDC-

• Followed by 279 ALGO to STBL.

• Then Gard by 111 ALGO per average swap.

• USDt with 93 ALGOs per average swap.

• Finally rUSD with 34 ALGOs per average swap.

So...

• Algorand touch it's bottom price movement during may 11, followed by a heavy influx of activity swaps, mostly focused on stablecoins movement and ALGO swaps.

• BUT while the sudden spike in Stablecoins being swapped for ALGO was expected in this kind of market scenarios, it wasn't so much for the Algo to Stablecoins movement, not in a clear reversal trend. (Though this is obviously easier to see once already bottomed out).

• While thrust can be considered responsible for the amount of ALGO swapped for. Panic could be the deciding factor in the amount of ALGO turned into stablecoins, signalling fear in the face of a possible downward price trajectory, in which case turning ALGO to stablecoins would make more sense to protect it from volatility.

• But also the volume of ALGO received from swaps did spike, continuing the expected reaction during a trend reversal, in where stablecoins help absorbing volatility and potentially giving high earnings once they are exchanged from a non stable asset, like ALGO.

• The volume in Stablecoins received for swaps did spike up.