Stablecoin Dai Lending Rates Decrease, Total DEX Volume Increases Over 16%


Compound, an Ethereum protocol that “establishes money markets with algorithmically set interest rates”, added the Dai stablecoin (DAI) to its protocol last year in December.

In the past week, Compound’s Dai supply APR (annual percentage rate) has fallen to around 2.95%, after reaching 11% in December 2018.

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Compound’s Dai borrow APR has also dropped to 9.68%, after recording an interest rate of 15.62% last month.

The peer-to-peer (P2P) market’s cumulative principal outstanding has depreciated by 0.35% over the past week, which is mainly due to the Dai repayment schedule. At present, Dai is the largest borrow market as it has issued $2.43 million in loans outstanding, while second-place ETH loans stand at $183,000.

Dai’s Supply Steadily Increasing, Up 4.04% Over Past Week

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Notably, the Dai supply has been increasing steadily (over 74 million, with 13,715 holders at press time), as it is up 4.04% over the last week. Some analysts attribute the increase to investors expecting a near-term upside for ether, and significant improvements in the CDP portal’s user interface.

An increase in Dai supply may also be partially due to investors being able to profitably arbitrage rates across both Maker (a decentralized platform for collateral loans) and Compound.

Last week’s MakerDAO CDP liquidations were quite low as only $6,163.35 in ether (appr. 0.0027% of total ETH locked) was taken by third parties. This relatively low liquidation activity could be due to low levels of volatility in the ether price and the high system collateralization ratio, which presently stands at 300%+.

BTC, ETH, BCH Adjusted Trading Volumes All Down From YTD

Bitcoin’s (BTC) average daily adjusted transaction volume during the past week was about $1.278 billion, down considerably from the year-to-date (YTD) average of $2.63 billion. Meanwhile, the ETH average daily adjusted transaction volume during the last week was of approximately $225 million, which is also down significantly from its YTD average of $936 million.

In the past week, Bitcoin Cash (BCH) averaged $132.06 million in daily adjusted transaction volume, after recording a YTD average of $215.95 million.

Daily gas usage on the Ethereum network has dropped by around 15.6% when compared to its YTD average. However, the decline in gas usage is not as significant as the 76% drop in ether’s average daily transaction volume. This suggests that developers continue to issue Ethereum-based smart contracts, even though they require gas fees.

Transactions Fees Drop Substantially, Network Security Also Down

Available data shows that bitcoin (BTC)’s average daily average transaction fees were around $74,000, while the YTD average is much higher at over $270,000. Ether’s (ETH) average daily transaction fees during the past week were approximately $43,000, whereas the YTD average for ether is about $289,000.

In the last week, Bitcoin Cash’s (BCH) transaction fees recorded a daily average of $40.32, and BCH YTD daily average fees were at $1,044.58.

Measured in terms of total miner revenue, the network security on the Bitcoin, Ethereum, and Bitcoin Cash blockchains continued to remain steady during the past week, however network security is down considerably YTD.

The Fee Ratio Multiple, which calculates how much transaction fees must grow in order to maintain a blockchain network’s security levels (assuming there are no subsidies issued), has increased for all major cryptocurrencies.

The Fee Ratio Multiple for the Bitcoin, Ethereum, and Bitcoin Cash blockchains recorded a 91x, 49x, and 5914x increase in the last week, respectively.

Transaction Volume On Decentralized Exchanges Increases

Transaction volume on all major decentralized exchanges (DEX) increased by 16% over the past week. IDEX, which accounted for nearly half of all DEX trading volume, recorded 9881 ETH in daily volume during last week – despite the introduction of know-your-customer (KYC) requirements.

Paradex, which is a relayer based on the 0x protocol, has been the leading all other relayers as it has over 71% of the total relayer market share.

New Relayer Veil Introduced, But Augur’s Prediction Markets See Open Interest Drop

Open interest on Augur’s (REP) prediction markets dropped by 6% during the past week, even though the decentralized betting platform launched its newly developed user-friendly relayer, Veil. Notably, the Augur Leaderboard reveals that one trader has managed to earn 856.47 ETH in profits, an amount valued at just over $100,000. The trader’s profits are nearly 50% of total profits to date by all other users of the Augur platform.

The market for ‘Which party will control the House after 2018 U.S. Midterm Election?’ recently entered into the 6th stage of disputes. Results from the 5th round showed most users expect ‘Democrats’ will control the House.

 

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