Try Quests to earn AXLTracking USDC Transfers on blockchains
Overview of analysis:
Let’s track the USDC as one of the most used stable coins in the crypto universe. The challenge here is to build the Ultimate On-chain Dashboard that track the transfer of USDC token on various blockchains and compare them with each others.
This dashboard divided into the following parts:
- Comparison of USDC transfer on various blockchains
- The General comparison
- The overtime analysis
- Detail analysis of USDC transfer on selected blockchain
- General and overtime analysis
- Distribution of transfers
This tool called parameter based analyzer and reader can set three various parameters:
- Blockchain→ Default set to Algorand
- Time period→ Default set to the past 2 months (60 days)
- Time Basis→ Default set to day
Methodology:
The data provided by Flipside has been used to handle this analysis. To handle this investigation the following steps have been passed as below:
- Step 1: Identification of USDC transfer on each blockchain with contract of token
- Blockchains→ Ethereum, Optimism, Arbitrum, Polygon, Solana, Algorand, Osmosis, Axelar, Near, Flow
- Step 2: Find the transfer related metrics and compare on various chains
- General→ Count of transfers and senders, Average transfer volume, transfer volume per day and per block, Sender per day, Median of transfer
- Over time→ General metrics overtime, Cumulative analysis, 7-day moving average volume of transfer
- Step 3: The precise investigation on selected blockchain (Algorand by default)
- Try metrics of the previous step
- Find out the distribution of transfers by amount of USDC
- Step 4: By aggregating the outcomes of the steps and deep dive into the blockchains, draw a conclusion about the usage of USDC across chain
What is stable coin?
Stablecoins are a type of cryptocurrency that is price stable over another asset. These assets can be Fiat currencies such as the dollar and the euro, commodities such as gold and oil, other digital currencies such as Ethereum and Bitcoin, or mathematical and supply-demand algorithms. Stable coins have been created to prevent sharp price fluctuations in the digital currency market and to create a link between centralized and decentralized finance, which now holds a large share of the cryptocurrency market.
A common misunderstanding about stable coins is that their value is fixed relative to all Fiat currencies. In fact, when we talk about "stable coin" or "stable digital currency", we should know that the concept of price stability is quite relative. For example, USD stable coins have a fixed value only against the dollar, but if the price of the dollar changes against other national currencies, the price of stable coins will change accordingly.
About USDC
Stablecoins backed by Fiat currencies such as the US dollar, the euro, and the YEN are the first and simplest single-currency stocks backed by a one-to-one ratio. As long as the value of the base currency (or basket of currencies, as Libra originally proposed) remains stable, the StableCoin will maintain its value. They basically borrow from the credit of the Fiat currency exporter, and it is the country's central bank that protects their value.
The USDC is like a programmable dollar that can be used 24/7 for large and small payments. This stablecoin is pegged one-to-one to the US dollar and its market cap is transparently visible in a public record. In addition, USDC's developer company, Circle, stores the USD Coin's backing dollar amount.
Initially, USDC was created as an ERC20 token for payments, lending, investing, trading and finance. On the Ethereum network, this stablecoin is integrated with decentralized finance applications, locking millions of users and hundreds of millions of USDC into digital wallets, exchanges, DeFi protocols, savings accounts, loans, and payment services. However, today USD Coin is not limited to Ethereum and has been released in various blockchains.
Findings:
The comparison of USDC transfer on various blockchains from different aspects has been done over the selected time period in this part:
- The Solana has the highest count of transfers but the volume of transfer has been dominated by Ethereum and Solana networks as can be seen.
- After Solana, the Layer2 chains of Ethereum have the highest count of transfers for USDC token.
- The Ethereum blockchain has the highest average transfer volume of USDC token per transaction, day and block.
- The count of sender per day in the selected time period reveals that the Ethereum network has the largest group of senders per day.
- The last two bar charts demonstrated the distribution of transfers and senders of USDC token on various blockchains to make reasonable comparison among them. For example, the highest share of transfers on Ethereum belong to 100-500 USD coins.
Findings:
This part presents the overtime comparison of USDC transfer on various blockchains over the selected time period and base on the chosen time basis (Day by default):
- The over time investigation reveals the domination of Ethereum blockchain on Volume and Solana network on count of transfers.
- The November 9, 2022 has the highest count of unique senders and the main reason of that is because of FTX crisis in the past weeks.
- The 7-day moving average transfer volume of USDC token on chains demonstrated that the Ethereum has larger average volume than other networks.
Part 2: Detail analysis of USDC transfer on selected blockchain
This part contains the precise investigation on transfer of USDC token on selected blockchain over the selected time period. What will you see in this part:
- The general and overtime analysis of USDC transfer
- The correlation of USDC price and transfer volume of USDC on selected chain: To track this relationship, the transfer volume and USDC peg analysis have been used on scatter plot and bar-line charts. For example, on Algorand when the price of USDC increased, the transfer volume of USDC increased, too (November 10).
- Distribution of transfers and senders by amount of USDC
Useful links:
- About Stabelcoins
- USDC token
- USDC on Coinmarketcap
Author:
Credited by MZG
Discord handle: m.zamani#0361
Twitter handle: @GargariZamani
Conclusion:
Now lets draw a conclusion based on the outcomes of the previous sections:
- The USDC as one of the most used stable coins in the crypto world has been transferred through several blockchains. The Solana takes the lead in count of transfers over the selected time period but if you talk about volume, the Ethereum has been dominated it.
- The distribution of transfers and unique senders on various chains varied due to the nature of users and application of USDC on them. In example on Ethereum and Solana as leading blockchains, have higher amount of USDC transfers compared to Layer2 chains (Optimism, polygon and etc) or Algorand chain.
- To go further, you can track the transfer of USDC on each blockchain and find out the more precise info about the pattern of transferring USDC over time.