Our Network: Issue #38

Web3 Coverage + Special Announcement 🎉

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This is issue #38 of the on-chain analytics newsletter that reaches 5000 crypto investors every week 📈

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This week our contributor analysts cover ETH Gas, Chainlink, and Numerai.

① Chainlink

Contributor: Blaise Cavalli, CEO and co-founder of Nyctale

  • Chainlink has continued its impressive growth of attracting new long-term investors. There are now 100k wallets labeled as long-term investors and a total of 150k wallets with a balance of greater than 10 LINK. This growth is mainly fueled by wallets having less than 1k tokens in their balance (“Micro” label), and wallets holding between 1 to 10k tokens (“Little” label).

  • Although the number of holder wallets is growing, the amount of tokens held by long-term investors has been decreasing all along the last few months. Around 50M tokens have moved from these wallets, which means there are more tokens circulating on the market.

  • During the recent price spike, we identified groups of wallets cashing out parts of their positions. These were mainly holding between 1k and 10k tokens (“Little” category). In parallel, many small investors (buying less than 1k tokens) joined the LINK community during this highly speculative period. Figures 3 and 4 below show the number of outgoing and incoming investors on LINK over the past few months:

Image 2020-09-11 at 11.42.21 AM
  • Surprisingly, the concentration of wealth in this period has significantly increased, moving from 0.25% for all wallets holding 90% of the total supply to 0.1% in the last 6 months. This means that while middle size investors enjoyed the price spikes to cash-out with a new wave of small investors, whales have kept consolidating their position in parallel. Figure 5 shows the 90% wealth concentration indicator for LINK:

  • Finally, active wallets and on-chain transactions are also on the rise, as there are now more than 40k active wallets responsible for 200k transactions on a weekly basis. This represents 100% quarterly growth for active wallets and +200% quarterly growth for on-chain transactions.

Image 2020-09-11 at 11.43.05 AM

② ETH Gas

Contributor: Professor Aleksandar Kuzmanovic, Co-Founder & Chief Architect at bloXroute Labs

  • This analysis compares Ethereum fees across two periods: a week in January 2020 and a week in August 2020.

③ Numerai

Contributor: Omni Analytics Group

  • Numerai hosts “the hardest data science tournament on the planet” as a weekly competition where users build machine learning models that forecast outcomes on financial assets. Since before 2017 and now into its 228th round, the tournament has seen steady growth in the number of data scientists signed up to participate.

  • Over the last 45 rounds, not only has the number of data scientists grown, but an increasing number of tournament participants have been staking Numeraire on their models. The process of staking involves the data scientist locking a portion of their Numerarie holdings into an Ethereum contract. This serves as a signal of the level of confidence they have in their model predictions for a given round.  At the end of each round, models are rewarded additional tokens depending on the quality of their results and the amount staked.

  • Through the release of Signals and ErasureBay, Numerai has been expanding the utility of its Numeraire token and this is reflected in the growth trend of the number of unique wallets now owning the token. Since summer of July over 40,000 new wallets began holding Numeraire, with a large spike of nearly 5,000 in the summer of 2020 after a series of partnerships were announced.

About the editor: Spencer Noon is Head of Investments at DTC Capital.