Try Quests to earn SOLThe Solana Smart Money
Question in detail:
Create a dashboard that tracks the most profitable traders on Solana (both in terms of token swaps and with NFTs). Use parameters to help define who falls under the category of most profitable and over what timeframe.
What has "smart money" been doing on Solana over the past month? Over the past week? Are they active traders or do they hold positions for days at a time? What projects have yielded the most profit for Solana traders? Are there any indicators of what their next trades or strategy will be? How does your dashboard compare to Hellomoon's smart money inflows and outflows?
Overview of analysis:
This dashboard is used to determine the most profitable traders on Solana for both token and NFT trades. This investigation has been divided into the following parts:
- Investigation on profitable NFT traders
- Profitable Token traders on
- Track Smart money on Solana
- Summary and references
The time period of finding most profitable traders is considered for the past 180 days (6 months). But reader can easily logged into the Flipside crypto and change the time period of determining profitable traders.
About Solana and profitable traders:
Solana is an open-source, public blockchain that supports smart contracts, peer-to-peer tokens (NFTs), and a wide range of decentralized applications. Coin is a native of the Solana SOL network, which, in addition to the role of exchanges, is also used to secure the network through staking or depositing. SOL digital currency is a native asset of this network and is used for staking. Solana blockchain uses staking to secure the power and security of its network. This network has a token writing standard called SPL, which stands for Solana Program Library, which is a set of instructions for creating and generating tokens on the Solana network platform. Solana network uses Proof of History (PoH) protocol. It is not proof of the history of consensus mechanism. Rather, it is part of Solana's consensus mechanism, Proof of Stake (PoS). PoH contains the timestamp of transactions added to Solana blocks. For this reason, it is also called a decentralized clock or a decentralized time source (Decentralized Clock).
About traders and Smart money on Solana:
Smart money is a powerful and decisive money. In fact, this money is in the hands of major investors who can identify the decisions of investors about the markets and even predict the general trend of the market.
Smart money in the hands of major investors can be a flow generator and direct the financial markets in the direction that these investors want. This money can be very influential in the price process of symbols.
Also, trading means buying and selling various assets in the financial markets in order to make a profit. It should be noted that in the cryptocurrency market, traders are people who buy and sell different digital currencies in certain time periods and profit from market fluctuations.
The opposite point of trading in digital currencies; Investing is holding or hoddling, buying one or more currencies for the long term with the aim of increasing its price. A trader is a person who buys and sells various assets in the financial markets, for himself or on behalf of another person or institution. The main difference between a trader and an investor is the length of time one holds an asset. Investors tend to have long-term time horizons, while traders tend to hold assets for shorter periods of time and profit from short-term trends in financial markets. Basically, investors are looking for long-term profits; Maybe even a few years or decades. Long-term investment or Hodel, although it takes a lot of time, but in return, the profit will be very large. But traders try to take advantage of market fluctuations. They enter and exit the market in a shorter period of time. Traders receive relatively less profit from each trade.
Methodology:
The data provided by Flipside has been used to handle this analysis.
This dashboard divided into the three major sections as below:
- Profitable NFT traders
- Used table→
solana.core.fact_nft_sales - Identification of profitable traders→ difference between volume of sold and bought NFTs in the selected time period
when profit_usd>0 then 'Make profit' When profit_usd=0 then 'Neutral traders' when profit_usd<0 then 'Lost money'
- Used metrics→ Distribution of profitable traders by net USD profit, Marketplaces used by most profitable traders, Top NFT collection popular among profitable traders, Share of whales among profitable traders, NFT hold time by these traders and most popular days of week that profitable trades trade on them
- Track the activity of profitable NFT traders in the previous month
- Used table→
- Profitable Token traders
- Used table→
solana.core.fact_swaps - Identification of profitable traders→ difference between volume of sold and bought tokens in the selected time period
- Metrics→ Like metrics for profitable tokens traders
- Used table→
- Track smart money on Solana
- Determine the sent and received assets onto the CEXs on Solana
Conclusion:
By considering the outcomes of this analysis the following statements could be concluded:
- Trading tokens and Non-Fungible Tokens (NFTs) is becoming increasingly popular as a way to make profits. With the emergence of blockchain technology, traders can now interact with networks such as Solana to purchase and sell tokens. This has opened up a whole new world of opportunities for token traders, allowing them to take advantage of the market inefficiencies and capitalize on the price fluctuations.
- By understanding the fundamentals of NFTs and token trading, traders can maximize their profits while minimizing their risks. They can use various strategies such as arbitrage trading, swing trading, and market making to take advantage of price movements in the market. With the right approach, profitable traders can make significant gains by actively participating in this new asset class.
- As can be seen from the consequences of this analysis, NFT traders have made more profit than token traders. Therefore, it can be said that buying and selling NFTs can be more profitable than regular trading if you have the necessary knowledge and familiarity with the nature of NFTs. Also, successful traders usually send their assets to centralized exchanges after earning the expected profit.
Key Findings:
The flow of smart money on Solana over the past month has been determined by the use of interaction of profitable traders with CEXs:
- According to the outcomes, most of the profitable traders sent their assets to CEXs by over 64% of share.
- The difference volume in USD between sent assets to CEXs and received from CEXs is about 10 million USD and the superiority belong to sending assets to CEXs.
- The normalize chart related to the interaction of profitable traders with CEXs reveals the domination of sending assets to CEXs over the past month. Also, highest volume of sent assets to CEXs occurred on January 14, 2023.
Key Findings:
Now lets determine the profitable token traders on Solana and the outcomes are as below:
- About 64% of token traders on Solana lost their money and only 36%of them make profit. It can be seen that the token trading on Solana over the past 6 months cause money lost because of the condition of crypto market.
- Also, the most of the profitable token traders on Solana over the past 6 months gained under 20 bucks.
- The Jupiter aggregator V2 is the most popular swap program on Solana among profitable token traders over the past 6 months.
- The important part of this section indicates the popular swap pair for profitable token traders on Solana. Based on the results, the USDC→USDT swap pair has the highest share on swap volume between profitable token traders on Solana. That outcome indicates that most of the profitable traders use arbitrage opportunity to make profit.
- The second most used swap pair among profitable token traders is Wrapped SOL→USDT pair and its because of the importance of SOL on Solana network.
- The profitable token traders on Solana have made their trades on Wednesdays more than other days of week.
- The trade activity of profitable token traders on Solana over the past month reveals that the trade volume and count have been decreased but there are some spikes specially on January 14, 2023.
Key Findings:
This part is presented the profitable NFT traders on Solana and interesting features of these traders have been determined as below:
- About 54% of NFT traders on Solana are profitable traders over the past 6 months.
- The important part of these NFT traders can be considered as their NET USD profit and according to the results, most of the profitable traders gain under 100 USD and about 5430 unique NFT traders have been obtained more than 5k USD as profit.
- The Magic Eden V2 is the most popular NFT marketplace that used by profitable NFT traders on Solana over the past 6 months.
- According to the results, the Okay Bears and DeGods are two of the most popular NFT collections that used by profitable NFT traders on Solana.
- The small part of profitable NFT traders on Solana are Whales (About 1 %).
- About 60% of most profitable NFT traders on Solana sold their bought NFTs within the first 24 hours.
- Monday is the most popular day of week for profitable NFT traders on Solana.
- The activity of profitable NFT traders on Solana over the past month has been determined and based on the results, the volume and count of trades by profitable traders have been decreased over the past month.
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