Introduction

On March 21st 2022, Thorchain introduced their version of synthetic assets called Synths. Synthetic assets are virtually tokenized derivatives that mimic the value of another asset. Synthetic assets, or synths, track real-world assets like stocks, commodities or even cryptocurrencies, and traders use them for various reasons such as taking advantage of lower fees, performing faster transactions and having access to 24/7 trading, among others. Normally Synths are backed 100% by the underlying asset. However, Synths are backed 50% by the underlying asset and 50% by the RUNE token using a liquidity pool. Because we are working with liquidity pools with two different assets, there is a risk of impermanent loss. However, Thorchain has set up a separate RUNE reserve to pay 1% of impermanent loss protections per day. This means that if one were to hold the Synth for 100 days, the user would be fully protected again impermanent loss.

This dashboard aims to analyze the average number of days users hold their synth.

Methodology

To find the average number of days users hold their synth, the thorchain.swaps table was used. Using this table, we can identify a mint of a Synth if the to_asset contains a '/'. We can identify a burn of a synth if the from_asset column contains a '/'. We estimate the number of days a user held a synth by identifying the first day the user minted a specific Synth and identifying the first day the user burned that specific synth. We then take the difference between to two dates to find the number of days held and count the occurrence to find the distribution.

Results

If we also account for the number of users, we can see that ETH.THOR scores very highly. This is largely because of the large number of users that held the Synth: 135.

Key findings

• Most users, about 51%, sold (a portion) of their Synth on the first day.
• Of the users that only held their Synth for one day, most sold within one hour.
• The Synth BNB.AVA, BNB.TWT and ETH.SNX have the longest average days held.
• If we also account for the number of users that hold the Synth, the ETH.THOR and BTC.BTC Synth score the highest.

We can see that most users sold (burned) their Synth within the first day they bought (minted) them.

If we were to express this in terms of the percentage of users, about 51% of users sold their Synth within 24 hours.

Because most users sold within the first day, we'll look at how many hours these users held their Synth for. We can see that most users that sold their Synth within the first 24 hours, also sold within the first hour. I think this indicates that most users right now are trying out the Synths, by quickly swapping them.

Next, we'll also look at the average days held per Synth, along with the number of users that bought and sold that Synth. We can see that BNB.AVA has the longest average days held, with about 8.6 days. However, we can also see that a relatively small number of users held this synth, only 3. Therefore, we'll also look at the a holding score that also takes into account the number of users that held that synth.