A Look At Solend User Distribution And Its Trend!

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Bounty : In this article, we will examine the distribution of users by account size in Solend. There are approximately how many people who have between $1 – $1,000, 1,000 – 100K, etc. How much does Solana’s protocol depend on whales, or does it depend on average users?

Approach

  • I have categorized users in 6 categories according to their borrowing amounts in this dashboard.
  • In my dashboard I explained different token usage on a daily basis by user category and the percentage contributions by category as well by using four main tokens used solely (SOL, USDC, USDT, and WBTC). 
  • We considered more than $500K as whale in this analysis.
  • By doing this dashboard, we can see the daily number of active users first, and then compare this number to the price of Solana.
  • The next step is to look at the daily transactions, and compare them with Solana’s price.
  • The next step is to determine the daily active users by user category and their percentages. 
  • Furthermore, we can also see the number of daily active users based on the usage of the tokens (Here we considered the SOL, USDC, USDT, and WBTC tokens).
  • Separately view token usage by daily active users and by percentage of daily active users.

Introduction

  • Let us introduce Solend, the Lending Machine Built on Solana. With Solend, users can earn interest and borrow on Solana in the easiest and most secure way. Due to its investor-friendly qualities, the project has gained a great deal of attention.
  • That means here we can see in Solana, Solend is the leading algorithmic protocol for lending and borrowing, powered by a decentralized algorithm. By leveraging their assets, anyone with an internet connection is able to earn interest, and by borrowing from their deposits, they can earn interest on their loan.
  • There are similar lending and borrowing protocols on different chains. For example, AAVE on Ethereum, Anchor on Terra, and BenQI on Avalanche. In the same way that the purpose of getting DeFi out is for it to be accessible to everyone, Solend is 100 times faster and cheaper than Aave or Compound is.
  • It is possible to think of Solend as the bank of the future, for everyone. Solend allows you to: Earn interest, Borrow, Leverage long-term and short-term contracts.

Comparing Daily Active Users And Transactions To The Price Of Solana

In the following graph, we can see the daily active users and their cumulative activity for the last three months. The total number of Active Users from May 4, 2022 to August 2, 2022 was 62.78K. A maximum of 1.8K Active Users was observed on May 11, 2022. The number of Active Users on May 13, 2022 is lower than normal, but higher than normal on June 18, 2022 and June 13, 2022.

In July 5, 2022, a maximum Solana Price of $25.83 was observed, and a minimum Solana Price of $0.02 was observed in May 23, 2022. In the period from May 4, 2022 to August 2, 2022, the total Solana Price declined by 71% from $0.89 to $0.26. July 5, 2022 and May 6, 2022 had higher total solana prices than normal and May 8, 2022 had lower total solana prices than normal. In this chart, we can see that the number of active users has decreased over time due to the volatility of the crypto market, and the number of active users per day is correlated with Solana price except at some points when the number of active users increased.

In the beginning, the number of daily transactions is not great. Later on, we can observe a decreasing trend. Again, we can see an increase in the number of transactions on Solend’s network from July 14,2022. A maximum of 2.03M transactions were observed on July 16, 2022 and a minimum of 3.77K transactions were observed on May 22, 2022.  The total number of transactions increased 10.13 times from 22.58K in May 4, 2022 to 251.44K in August 2, 2022.

In this chart, we can see that the number of transactions has decreased over time due to the volatility of the crypto market, and the number of transactions per day is correlated with Solana price except at some points when the number of transactions increased.

Daily Active Users By User Category And Their Percentages

Here in this section we have categorized users in 6 categories according to their borrowing amounts on daily basis for the past 3 months . Between May 5, 2022 and August 2, 2022, there were 6,126 active users.  90.39% of total users came from the Top 2 Categories(Less than 1000 USD and 1000 USD to 10K USD). A total of 11 users (500K to 1 million USD) is the lowest, while a total of 4,306 users (less than 1000 USD) is the highest. A maximum of 198 users were recorded on May 9, 2022, and a minimum of 1 users were recorded on June 23, 2022. Between May 5, 2022 and August 2, 2022, the number of users decreased. In June 19, 2022 and July 22, 2022, the total number of users is lower than normal, while in June 25, 2022 and June 13, 2022, it is higher than normal.  There was a significant drop in Users in August 2022. The main reason for this is less than 1000 USD.

Based on the below graph, we can see that the Top 2 Categories (Less than 1000 USD and 1000 USD to 10K USD) contributed 90.42% of all users. The lowest number of users (500K to 1 million USD) is 11, while the highest number is 4,306 (less than 1000 USD). From this, we can conclude that when we look at the daily active users by category of their borrowing amounts, the normal user category is looking almost 70% of all other categories. Here, only 11 whales (from 500k to 1Million USD) can be seen. We can conclude from this that Solana’s protocol relies mostly on normal users rather than whales.

Active Users By Their Used Tokens(SOL,USDC,USDT &WBTC) And Percentages

Between May 5, 2022 and August 3, 2022, there were 6,147 active users. Of the 4 tokens, USDC is the highest contributor (41.6%) to the total users. Among the total Users, WBTC has the lowest total of 291 and USDC has the highest total of 2,557. From May 5, 2022 to August 3, 2022, the total number of users decreased. A lower number of users were recorded on July 22, 2022 than normal, while a higher number of users were recorded on June 25, 2022 and June 13, 2022 than normal.

Here from the below graph we can see the daily number of active users which are categorized by users and used a Solana Tokens for the past 3 months period. From the below graph, we can see that there were 1.6K active users between May 5, 2022 and July 28, 2022.  The maximum number of users was 63 on June 18, 2022, and the minimum number was 1. A decrease in total users was observed. There was a significant decline in Users in July 2022. For this contribution from less than 1000 dollars is the most important factor.

Out of the 5 categories, Category Less than 1000 USD contributes the most (93.22%). The lowest total number of Users is 2 (100K to 500K USD) and the highest is 1,553 (Less than 1000 USD). In this area, we cannot see any whales (500K USD to 1M USD). From our analysis, we cannot see any whales used in Solend as Solana Tokens. 

Here from the below graph we can see the daily number of active users which are categorized by users and used a USDT Tokens for the past 3 months period. From the below graph, we can see that there were 1,633 active users between May 5, 2022 and July 28, 2022.  The maximum number of users was 76 on May 12, 2022, and the minimum number was 2 on July 29, 2022. A decrease in total users was observed. There was a significant decline in Users from May to August 2022.

Out of the 6 categories, Category Less than 1000 USD contributes the most (60%). The lowest total number of Users is 6 (500K USD to 1 Million USD) and the highest total Users is 997 (Less than 1000 USD. In this area, we can see 6 whales (500K USD to 1M USD). The number of normal users using USDT Tokens is higher than the number of whales using USDT Tokens. 

The following graph shows the number of active users categorized by users who have used USDC Tokens for the past three months. According to the graph below, there were 2,557 active users between May 5, 2022 and July 28, 2022.  The maximum number of users on May 5, 2022, was 124, and the minimum number was 4 on July 24, 2022. The total number of users decreased. In May 6, 2022 and May 14, 2022, total users were lower than normal, and in June 13, 2022, they were higher than normal.  There is a steady percentage of users between 500K USD and 1 Million USD.

Among all six categories, Category Less than 1000 USD contributes the most (64%). 88.7% of total users came from the Top 2 Categories. There are 3 users (500K USD to 1M USD) and 1,645 users (less than 1000 USD. In this area, we can see 3 whales (500K USD to 1M USD). USDC Tokens are more commonly used by normal users than by whales in Solend. 

The following graph shows the number of active users categorized by users who have used WBTC Tokens for the past three months. According to the graph below, there were 291 active users between May 5, 2022 and July 28, 2022.  The maximum number of users on June 19, 2022, was 26, and the minimum number was 1 on May 10, 2022. The total number of users decreased. In May 10, 2022 and June 20, 2022, the total number of users was lower than normal, and in June 18, 2022 and June 19, 2022, the number of users was higher than normal. The number of users increased significantly in the month of June 2022.As we can see ,  Less than 1000 USD and 100k to 500k USD are the key contributors. 

Among all 5 categories, Category Less than 1000 USD contributes the most (45%). There are 2 users (500K USD to 1M USD) and 131 users (less than 1000 USD. In this area, we can see 2 whales (500K USD to 1M USD). We can therefore conclude from the above analysis that WBTC Tokens are more commonly used by normal users than by whales in Solend. 

Observations

  • According to the above analysis, the number of active users has decreased over time due to the volatility of the crypto market, and the number of active users per day correlates with Solana price except when the number of active users increases.
  • Due to the volatility of the crypto market, we can also see that the number of transactions has decreased over time, and the number of transactions per day is correlated with the price of Solana.
  • Based on the daily active users by user category, 90.39% of all users came from the top two categories (less than 1000 USD and 1000 USD to 10K USD). The whales (ranging from 500k to 1 Million USD) can be seen here only in 11 active users. This indicates that Solana’s protocol relies mainly on normal users rather than whales.
  • When we look at active users by their used tokens(SOL,USDC,USDT &WBTC) and percentages, we will find that normal users are using tokens more frequently than whales. Hence, we can conclude from this as well that the Solana protocol is not dependent on whales. It is purely dependent on regular users. 

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