Do incentivized wAssets impact transfer volumes on Axelar?

The aim of this dashboard is to identify if Axelar should work with Osmosis to incentivize more wrapped assets, in order to increase volume over Satellite and Squid.

Introduction

In June 2022, Osmosis launched cross-ecosystem token swaps with the help of Axelar, a secure cross-chain communication infrastructure provider. They started by supporting swaps between Ethereum and Cosmos-based tokens, but soon expanded to Avalanche, Binance Smart Chain, Polkadot, and Polygon ecosystems using Axelar. This created a one-click application for universal cross-chain swaps, allowing wrapped versions of AVAX, BNB, DOT, and MATIC tokens to arrive on Osmosis via Axelar.

This dashboard investigates whether this collaboration between Axelar and Osmosis works effectively.

Method

This dashboard consists of four distinct sections in addition to this 'overview'. The first three sectons present the dynamics of volume and number of bridges to Osmosis through Axelar for three wrapped tokens: wMATIC, wBNB, WAVAX. This data will be compared with other bridge possibilities. Each section will also include a snapshot of the current status of each token.

The fourth section is the comparison section, where the evolution of wrapped token bridges will be compared by volume and number.

Observations

wMATIC

According to the data, the volume and number of wMATIC bridged to Osmosis has surged since mid-December. The majority of wMatics are migrating to Osmosis through Axelar, but Polygon has gained some market share while Axelar remains dominant. The activity on the OSMO/wMATIC pool has also increased since mid-December, but the number of actions has been trending downward.

wBNB

The data indicates that the volume and number of wBNB bridged to Osmosis has increased since mid-November 2022. The number and volume of bridges through Axelar have been trending upward over the past two months. The second most popular path for wBNB to Osmosis is through Binance Chain, but its market share has decreased since the incentivized transfers initiated between Axelar and Osmosis. Activity on OSMOS/wBNB is showing a similar downward trend to that on OSMO/wMATIC.

wAVAX

According to the data, the volume and number of wAVAX bridges to Osmosis has increased since the beginning of February. However, the increase is not significant.

Comparison

Based on the analysis and graph presented on the "Comparison" page, the all-time volume of wMATIC bridged to Osmosis using Axelar in USD is twice that of both wAVAX and wBNB. In terms of the number of bridges, wMATIC is also higher than the other two. However, there is a significant difference between the number of wBNB bridges and wAVAX bridges.

Therefore, we can conclude that wMATIC is the most popular wrapped L1 asset to bridge to Osmosis through Axelar, and the second most popular is wBNB.

Furthermore, when looking at the time series and cumulative charts, we find that incentivized wAsset programs have a positive impact on both the number and volume of bridges through Axelar.

More about the Author

Twitter: @SocioCrypto

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