Preliminary Analysis of The Relationship Between Alchemix and Defi-Pulse Index Metrics

This is the second analytical project about Alchemix (ALCX) in order to help readers better understand the various factors that are driving price on a daily basis. This time, Alchemix is being compared to Defi-Pulse Index (DPI), which is essentially an index of the entire decentralized finance market. A few questions were investigated:

  1. What is the relationship between DPI index price and Alchemix price? Is Alchemix under or overperforming on this metric?
  2. What is the swap volume comparison on each of the tokens’ biggest DEX pairs?
  3. What is the relationship between DPI index total accounts and Alchemix total accounts? Is Alchemix under or overperforming on this metric?

All the answers to these questions were determined through Flipside’s querying tool. Queries were run with the help of Block49.

Key Takeaway: Since inception, Alchemix has greatly outperformed the DeFi market in terms of price, and volume is much greater than DPI. However, Alchemix is still a relatively new product even in the DeFi world, and this is evidenced by the fact that # of ALCX holders is much less than DPI.

All links to Velocity’s charts here:
1. https://velocity-app.flipsidecrypto.com/shareable/alcx-and-dpi-price-hUoixC

2. https://velocity-app.flipsidecrypto.com/shareable/alcx-and-dpi-holders-ieoOVm

3. https://velocity-app.flipsidecrypto.com/shareable/holders-v2-8g9Gir

Exploratory Analysis

The first question asked for the correlation between the daily price of Alchemix and DPI. Alchemix only launched a bit over a month ago on Feb. 27, therefore a comparison can only be made since this starting point. DPI has performed quite well since its own inception, but the price has hovered around $500 since Alchemix debuted on the market. Alchemix’s price is much more volatile and saw 2 extreme dips during the month of March, while the price has surpassed $2,000 a few times. Alchemix has since a 4x increase since Feb. 27.

The second question was to investigate swap volumes of DPI vs. ALCX. As evidenced in the graph, ALCX’s volume is much greater than DPI’s, and is quite volatile, with some daily volumes reaching over $20 million, and others going below $5 million. DPI’s volume reached a peak on March 18th of $230K, which is minuscule in scale compared to ALCX. There are many days where DPI’s volume is essentially nominal.

The last question was to compare number of DPI holders vs. number of ALCX holders. DPI has many more holders than ALCX at this point: 21.4K vs 8.42K. This is due to one main reason: DPI has been on the market for a while and debuted right after DeFi summer, while ALCX only debuted just over a month ago. Some crypto traders and investors may also be more comfortable investing in DPI due to its main advantage of diversification. In terms of direct comparison for the time it took to reach a certain number of users: it took ALCX 1.5 months to reach 8.5K holders, and it took just under 3 months for DPI to reach the same amount of holders. I do believe that market momentum in the past few months has ultimately benefited Alchemix, as well as the traction that its image has gained on Twitter (good or bad). All press is good press, right?

Crypto investor, believer in a more equitable digital future.

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