Data & Insights Recap - April 10, 2023

Staying True(USD)

• Although we are early into the month, it seems as though TrueUSD has already secured itself as a breakout star.
  • While previously only accounting for less than one percent of trading volume by denomination (or in other words, less than one percent of spot trading volume had TUSD as the quote asset), so far this month the stablecoin is on pace to account for over 6% of that volume, making it the fourth most dominant quote asset.
  • On the losing end of TUSD’s rise is BUSD, which is on track to have its lowest pair denomination share since April 2022. 
  • This is not shocking given that the issuance of BUSD was halted in February, causing Binance to reevaluate its fee promotions (which previously were heavily incentivizing the use of BUSD by offering zero maker fee on all pairs). 
  • At the end of last month, we saw Binance move to offer no fees on only BTC/TUSD, after offering no fees on the majority of BTC fiat and stablecoin pairs before, in addition to reinstating fees on BTC/BUSD, ETH/BUSD, and BNB/BUSD and removing maker fees on BTC/TUSD and ETH/TUSD. 
  • Binance did commit to continuing to support BUSD, but did mention that a move away from BUSD as the main stablecoin could be in the cards. Binance then minted 50 million TUSD, which in conjunction with the recent fee reform, makes it seem as though TUSD is their new top choice.
  • Ironically, back in September, Binance ended support for TUSD and delisted all TUSD pairs in an attempt to drive BUSD adoption. Only last month did we see TUSD pairs return to the scene on Binance. 
  • While Binance’s new attention to TUSD has driven up its share, it's still nothing compared to the likes of its USDT counterpart. That being said, BTC/TUSD has outperformed BTC/BUSD in terms of daily volume on Binance since March 31. 
  • Binance still offers more BUSD pairs than TUSD pairs, so despite the flip on BTC, it's not too crazy to see BUSD maintain some dominance.

Block blocked

• Only 6,995 blocks were created on the Ethereum network on April 6th, the lowest since September 15th, the day of The Merge, which saw the number of blocks per day rise to over 7k, as the slot time was set at 12 seconds.
  • In each slot, a validator is selected to propose a block, meaning there should be one block per slot, assuming all validators are fully functional.
  • In theory, this means there should be 7,200 blocks per day, a metric that has never actually been reached since slots can be empty if a validator is offline when it is selected. 
• It took a couple of days for the number of blocks to stabilize post-Merge, but after September 22nd, it was typical to see over 7.15k blocks a day, meaning an average block time below 2.1 seconds.
  • In mid-February, there was a drop off to around 7.11k blocks per day, with the average block time reaching at least 2.12 seconds most days. Around that time, we also saw an increase in missed blocks, which typically accounted for less than half a percent of daily blocks before. 
  • Then coming into April, we saw another rise in the average block time, reaching as high as 12.27 seconds, with 1.96% of blocks missed and 0.88% of blocks orphaned. 
  • The recent drop-off in daily blocks seems tied to a recent vulnerability patch for MEV-Boost relay, which introduced higher latency and as a result has caused validators to miss slots. 87% of validators are registered with Flashbots MEV-Boost Relay, which explains why a change in their patch would have such a deep impact. 
  • The team believes they can reduce the latency sufficiently, which they are working to deploy as soon as possible. The number of blocks per day has also recovered a bit to around 7.06k over the weekend. 

Seller Spike

• This week marked a huge uptick in NFT sellers on Ethereum, up 34.35k on April 5th compared to only 19.32k on April 3rd, an almost 80% increase in just two days.
  Buyers also went up, but not as significantly as sellers did. 
  • Breaking down sellers by platform, we see the largest rises from OpenSea and Blur. OpenSea rose from 15k to 27k sellers and Blur jumped from 5k to 8k, an 80% and 65% jump, respectively. OpenSea was also the only platform to see any meaningful buyer growth over the same time period. 
  • The number of NFT sellers on Ethereum quickly dropped back down to below 25k after the initial excitement was over. 
• This is to be expected, though, given the launch of OpenSea Pro on April 4th. OpenSea acquired the NFT aggregator Gem last year, which seems to be the basis of this new Pro offering.
  • In addition to being able to list NFTs for free during a “promotional period” on OpenSea Pro, likely driving up sellers as users move to list their NFTs when there are no fees, OpenSea also hinted at the form of community rewards in the form of NFTs. It is not exactly the token airdrop many people farm, but it is still a means to incentivize OpenSea usage. 
  • OpenSea Pro, out of the gate, began outperforming Blur’s NFT aggregator in terms of volume, but has already seen a decline. However, it remains on top for transactions and active users. 
• As mentioned last week, the top 1% of Blur users account for 70% of the platform’s volume, and it’s unlikely we will see those power users moving over to OpenSea because the opportunity cost is too high, according to The Block Pro Research analyst Brad Kay. 

USDC sees stability in supply

• The supply of USDC had been strictly decreasing from March 9th to April 1st, dropping from 41.05 billion to 30.81 billion, a roughly 25% decline.
  • You’re probably familiar by now with the fact that USDC faced a tough situation back in early March, when it became known that Circle had $3.3 billion stuck on the failed Silicon Valley Bank. 
  • The second largest stablecoin by supply then depegged as low as $0.88 and faced a surge of redemptions as faith was shaken. And despite funds on SVB being fine and Circle being able to redeem all USDC for $1 (although some transactions were delayed due to technical difficulties with Signet), the burning of USDC continued through the rest of the month.  
  • Circle did face a lot of backlash for their initial lack of response to the SVB situation. While many companies and protocols were coming forward to state their exposure, Circle remained quiet despite the fact Silicon Valley Bank was listed as one of their banking partners in their transparency report. 
• However, USDC has continued on without any more depegging incidents since mid-March. 
  • They found a new banking partner, Xapo, to handle USDC conversions after Signature and the 24/7 Signet network ceased operations. 
  • MakerDAO, the issuer of crypto-collateralized stablecoin DAI, also voted to keep USDC as their primary reserve asset after the depegging. 
  • And it seems now, there has been enough reassurance that we have seen some positive movement in USDC’s supply, meaning more USDC has been minted than burned. The supply increase has helped USDC cross back over the 31 billion threshold as of April 6th (but now it sits at 30.94 billion). 
  • That being said, the daily increases are much lower than the drops we were seeing through March. And while the more stagnant supply is a good sign that fear might be over, it doesn’t mean people are now super bullish on USDC. There’s still 10 billion to go before the supply reaches early March levels. 
  • In addition to the supply finally showing some signs of recovery, the number of addresses holding USDC has also begun to rise a bit.

Doge-d a bullet 

• Last week saw what many presumed to be a late April Fools’ prank play out on crypto’s favorite social media.
  • On Monday, the iconic blue bird silhouette was swapped for a familiar face. Elon Musk once again proved to be a proponent for Dogecoin after changing the Twitter icon on the website to the famous Shiba Inu. 
  • The price of Dogecoin (along with other dog-related memecoins like SHIB) skyrocketed, briefly reaching over $0.10 on both Monday and Tuesday after sitting below $0.08 before the change was made. And it seems beyond the price, Dogecoin also garnered some attention on the platform where it temporarily became the logo, raking in 39.4k new Twitter followers the week of April 3rd, a huge step up from previously only gaining less than 8,000 followers each week so far this year. 
  • On Thursday, the icon flipped back to its original form, which sent the price of DOGE down, but it still sits higher than it was prior to the initial change.
  • Musk’s impact on the value of Dogecoin has him in some legal hot water, being the subject of a class action lawsuit accusing the Twitter CEO of market manipulation. 
• Like most of the top 20 cryptocurrencies by market cap, DOGE is up for the month after a strong performance in March.
  • DOGE currently stands as the 6th best-performing asset of the top 20 for the past month, partially due to its remaining price bump from the icon switch.