Open Analytics - 23. Ethereum

    (Paraswap)

    Introduction

    Paraswap solves problems of shortage of liquidity by providing liquidity across multiple exchanges. It also additionally gives user powers to select an exchange or split his order across multiple exchanges. It helps traders to get fair and best prices possible across the Ethereum network. Currently, it only focused on the Ethereum blockchain where most of the DeFi projects are created so supports Ethereum and ERC20 Tokens but they want to become a go-to the platform for token swaps regardless of the product type. It could be a blockchain-based game, a prediction market, or a payment app that allows its users to pay the best price using any token. Initially, Paraswap only supported trading of tokens (ERC20) based on Ethereum Network, In May 2021, they added supports for assets created on Binance Smart Chain (BSC) and Polygon (Matic Network). So users can trade BEP-20 and also ERC20 (Matic) tokens as well.

    Methodology

    I’ve used ethereum.core.fact_event_logs , optimism.core.fact_event_logs , arbitrum.core.fact_event_logs & polygon.core.fact_event_logs and of course filter transactions with event_name = 'Swap' because i just want swap transactions.

    Paraswap address on these four network:

    '0xdef171fe48cf0115b1d80b88dc8eab59176fee57'

    All data and reviews are from Jul 10 because I wanted the data of all networks to start from the same available date.

    Analyzed topics

    • Number of Swaps per Network, Unique Users per Network, Pools per Network and New & Total Users
    • Total Number of Swaps per Network and Unique Users per Network
    • Average Number of Swaps per User
    • Top 10 Swap from Asset and Swap to Asset
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    Paraswaps Overtime

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    Each network has its active and loyal users who prefer to do all their activities on those networks, so a DEX that is active on several different networks can attract many users, and exactly Paraswap is one of those DEX that It is active on several networks, this DEX is active on Ethereum and layer 2, and now let's see if this famous DEX has more fans on Ethereum or on layer 2.

    The number of paraswap swaps was on a quiet and steady trend from July to October, and we had no increase in the number of swaps on any network, and this dull trend continued into early October.

    From around October 7, the number of swaps in this DEX increased explosively and kept its momentum 3 months into 2023 but the point is that this increase in the number of swaps only happened on the Polygon network, and we did not see as much of a large increase in the number of swaps in other networks.

    If I want to show you exactly what I mean by the sharp increase in the number of swaps, I must tell you that the number of Paraswap swaps was 1,660 on October 6, but the number of swaps on this DEX reached 13,400 on October 19, which means an increase of nearly 800% in the number of swaps in this DEX, so do you think we can call this something other than explosive growth?

    Of course, a very important point that I mentioned earlier is that this sharp increase in the number of swaps occurred only in Polygon and we did not have such an increase in other networks. The swaps were close to 50%, but after this growth reached 90%, which shows the increase in popularity of this network in Paraswap, because around 90% of user activity in this DEX is for Polygon.

    In the number of active users of this DEX, we have exactly the same conditions, and after the beginning of October, we had a huge increase in the number of active users of Paraswap, and this increase was only in the Polygon network, and this is another sign of the increase in the Polygon network among the active users of Paraswap.

    At the beginning of October, good news was published for Paraswap, and it is likely that this news has increased the activity of users in this DEX.

    ParaSwap announced on Twitter that it found no Profanity vulnerability after investigation, and it will follow up with analysis and an explanation of how it made sure the deployer address had no power.

    Previously, Web3 security company Supremacy said that ParaSwap's deployer address private key might have been compromised due to Profanity vulnerability, and funds had been stolen on multiple chains. But ParaSwap said the address had no power.Source

    Total & New Users

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    The trend of attracting new users in the two big networks, Ethereum and Arbitrum, has been declining, and in the Optimism network, the number of users attracted is very low, and compared to other networks could be considered low as well but in 2023 a phenomenal jump in new users across Ethereum, Arbitrum and Optimism is recorded.

    In Polygon network, the situation is different, and this network has been very effective in attracting new users in last three months of 2022, so that this network has attracted 6700 new users in just one day, on October 19, which is a very good number, and this network has been around for a long time. that the activities of Paraswap increased, that is, since October 6, for example the total number of active users of the Polygon network has increased from 12,000 to 48,000, and this means that this network has been very successful in attracting new users but as mentioned after late 2022-early 2023 number of users on the network begin to decline and this could be observed on any other analyzed networks, overall this shows that Paraswap is performing very well. It has been popular in the network because it has attracted many users.

    Total Stats

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    You must have noticed by now that Ethereum especially Polygon is very popular among Paraswap users, and Polygon network alone showed that layer 2s are much more popular than relative to Ethereum despite to its widespread.

    The total number of swaps in Polygon is 1.18M swaps, while the total number of swaps in the Ethereum network is 146K swaps, which shows how much more popular this network is than Ethereum. The total number of active users of Polygon is 213K users, which is a very good number for Paraswap, while the total number of active users of Ethereum is 28.8K users, which is almost a seventh of Polygon.

    The number of swaps per user in the 2 networks, Ethereum and Polygon is close, 5.1 and 5.53 respectively, which means that each user does around 1.5 more swaps on average in these two networks compared to Arbitrum and Optimism, the users of the Arbitrum network are not as active having the least average swaps done per user.

    Most Popular Assets

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    As expected the most popular asset in all 4 networks is USDC as the most widely adopted stable coin among traders, whether it is converted to another asset or converted to another asset In addition to that other than Ethereum and Optimism which have their native token as their second most swapped assets. next most swapped assets on all of the other platforms are other stable coins could indicates that Ethereum (wETH) and Optimism (OP) had more successful and adopted native tokens.

    In the Ethereum network, 23K swaps from USDC to other assets have been registered, and on the other hand, 33 thousand swaps from other assets to USDC have been recorded.

    In Polygon network, 185K swaps have been registered for swapping USDC to other assets, and this means that the most transfer of paraswap assets is done in Polygon network.

    In addition other than Ethereum and Polygon the two other networks have proximately same inflow and outflow of swapped USDC assets.

    Conclusion

    As I told you at the beginning of my analysis, DEX can work in different networks will definitely be very successful, because every network has its loyal and active users.

    You must have realized by now that if Parareswap was not as active on the Polygon network as it is, it would not have the number of users and the popularity it has right now, because its users are much more active on this network than on other networks which overall helps the platform to reach beyond its initial grasp and with larger/expanded recourses and more a robust marketing increase its influence in DEX scene across major networks.

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