Does Aave Gas Pricing Affect Deposit/Borrow Amounts?

In this article, we discuss how deposits and borrowing amounts have changed as gas prices have continued to rise?

About AAVE

Aave is a decentralised non-custodial liquidity market protocol that participants can use either as depositors or borrowers.As borrowers are able to borrow in either an overcollateralised (perpetual) or an undercollateralised (one-block liquidity) fashion, depositors are able to earn passive income.A complete open source protocol enables anyone to interact on the Ethereum network using a user interface, API or directly with smart contracts.A protocol that is open source means that you are able to create any third-party application or service that interacts with the protocol.

Depositing and Borrowing – AAVE

Deposit : To deposit an asset, navigate to the “Deposit” section and click “Deposit”.Make your deposit and submit it.Following confirmation of the transaction, you begin earning interest on your deposit.It is not necessary to deposit a minimum or maximum amount.Nevertheless, it is important to consider that the transaction costs may be higher than the expected earnings for really low amounts.

Borrow : Firstly, deposit collateral.Then click “Borrow” under the Borrow section to borrow the asset. Calculate the amount you need based on the money you have deposited that will serve as collateral. Rates can always be changed after that as often as you like.If you don’t have enough liquidity or you don’t have a good health factor, you can’t borrow an asset.

We will explain in this article how the AAVE transactions and users were changed, when doing a deposit and borrowing of assets in 2 different ways, for instance when the gas fee is greater than 100(>100) and less than or equal to 100(<=100).

Aave Transactions – Borrows & Deposits

We have shown in the graphs below the average transactions that happen when depositing and borrowing in two different cases, when fees exceed 100 and when fees are equal to 100.

For Gas fees >100, a maximum total transaction of 5,789 was observed on April 26, 2021, and a minimum total transaction of 195 was observed on May 11, 2020. In November 1, 2021, the maximum Total Transaction Fee(USD) was 499.4 and the minimum Total Transaction Fee(USD) was 2.93. Total Transaction Fee(usd) shows an increasing trend. The total transaction fee (usd) in March 1, 2021 and May 17, 2021 was lower than normal; however, in November 1, 2021 and May 10, 2021, it was higher than normal.

Deposits(Gas Fee>100),In September 13, 2021 and March 1, 2021, the total transaction fee (US dollars) is lower than normal, while in April 5, 2021 and October 25, 2021, the total transaction fee (us dollars) is higher than normal.

Here If we consider gas fee<=100 in case of borrowing ,Maximum Total Transactions of 290 was observed in June 14, 2021 and minimum Total Transactions of 6 was observed in August 30, 2021. Total Transaction Fee(USD) shows an increasing trend.In May 17, 2021 and April 5, 2021, total transaction fees (US dollars) are lower than normal, and in May 10, 2021 and September 6, 2021 they are higher than normal.

Consider gas fee<=100 in case of deposit the aave transactions,Maximum Total Transactions of 1,383 was observed in July 6, 2020 and minimum Total Transactions of 76 was observed in August 30, 2021.July 26, 2021 and January 4, 2021 had fewer transactions than expected, and May 31, 2021 had more transactions than expected.In March 1, 2021, total transaction fees (usd) are lower than normal and higher than normal in May 10, 2021 and March 29, 2021.

Aave Users – Borrows & Deposits

Users of Aave – Borrowing when the gas price is greater than 100$ had the maximum number of total wallets of 2.58K in W17, 2021, and the minimum number of total wallets of 97 in W20, 2020.And also in the same case we observed for the maximum of 5,789 transactions in W17, 2021, and the minimum of 195 transactions in W20, 2020. A lower total of wallets were found in W34, 2021, and a higher total was found in W17, 2021. W9, 2021 and W20, 2021 have lower total transaction fees (usd) than usual, while W19, 2021 has higher fees. Transactions in W18, 2021 are lower than normal and higher than normal in W17, 2021.

In case of Aave users, ETH gas fees for deposits greater than 100$ resulted in a maximum of 3.94K total wallets in W17, 2021. The total number of wallets in W39, 2020 is lower than normal and higher than normal in W20, 2021 and W17, 2021.In W14, 2021, a maximum Total Transaction Fee(usd) of 436.62 was observed.We have seen lower than normal total transaction fees (US Dollars) in W37, 2021 and W9, 2021 and higher than normal fees in W14, 2021 and W43, 2021.The number of transactions in W20, 2021 and W17, 2021 was higher than normal.

Aave Users – Borrowing Upto 100$ vs ETH Gas Fees, the maximum number of wallets was 229 in W24, 2021 and the minimum number of wallets was 6 in W35, 2021.A lower total wallet in W25, 2021 and W36, 2020, and a higher total wallet in W23, 2021 are observed than normal.A maximum Total Transaction Fee(usd) of 412.77 was observed in W43, 2021, and a minimum Total Transaction Fee(usd) of 2.36 was observed in W19, 2020.In W20, 2021 and W14, 2021, the total transaction fee (usd) is lower than usual, while in W19, 2021 and W36, 2021, it is higher than usual.We observed maximum Total Transactions of 290 in W24, 2021 and minimum Total Transactions of 6 in W35, 2021.

When comparing Aave Users – Depositing up to 100$ against ETH Gas Fees, a maximum of 1.12K total wallets was observed in W27, 2021, whereas a minimum of 61 total wallets was observed in W35, 2021.The total number of wallets in W30, 2021, and W1, 2021 is lower than normal, and the total number of wallets in W22, 2021 is higher than normal.The maximum Total Transaction Fee(usd) observed in W19, 2021 was 308.36, while the minimum was only 1.18.The total transaction fee(usd) in W9, 2021 is lower than normal, and higher than normal in W19, 2021 and W13, 2021.W28, 2020 recorded the maximum Total Transactions of 1,383 and W35, 2021 recorded the minimum Total Transactions of 76.Transactions in W30, 2021 and W1, 2021 are lower than normal, and transactions in W22, 2021 are higher than normal.

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