Arkadiko — Q4 2021
This is a quarterly update on Arkadiko for the wider community, written by the core contributors.
These reports are not financial advice and should serve for informational purposes only :)
The numbers below cover the period of our launch (21-OCT-2021) until the 1st of January 2022, unless stated otherwise.
Starting with a few metrics:
TVL (vaults + LPs):
TVL was $45M on January 1st. TVL goes up and down a lot, mostly dependant on the STX price. We hit a high of $70M in December (when STX shot up to $3), but largely it’s been hovering around $50M. Currently (end of January) we’re in a bit of a dip with TVL around $26M. Our TVL is largely correlated to the price of STX.
# of addresses
We’ve had 1876 unique addresses doing a swap on Arkadiko Swap.
At the time of writing there are just under 1900 vaults.
We can assume that more unique addresses do a swap vs open a vault, so the unique addresses having a vault is likely between 1000 and 1500. We could track this, but have not done so far (as this is not a leading metric for us).
Up until the 1st of January, 9372 swaps happened (about ~140/day).
STX/USDA: 7,952,869.032729 STX / 17,722,908.730486 USDA
DIKO/USDA: 2,263,614.941926 DIKO / 3,766,660.038943 USDA
STX/DIKO: 3,931,624.094813 STX / 4,310,568.844445 DIKO
STX/xBTC: 225,921.648602 STX / 9.37609042 xBTC
xBTC/USDA: was not live yet
STX/WELSH: was not live yet
At current prices, that is over $50M in trading volume. 25bp of this goes to LPs. 5bp is currently accrued by the DAO, and sits unused in the DAO wallet.
Stability Fees from USDA: ~18,600 USDA
Swap Fees (5bp): ~$21,000
Total Revenue: ~$39,600
These are approximations (depending on the value of the tokens that come in as revenue)
Transactions can be found here
December was Arkadiko’s best month yet, bringing in the bulk of protocol revenue (~$23K).
Team & Treasury
Arkadiko has a small team of 4 core contributors and 4 community managers, 8 people in total. This might grow up to 10–11 people this year, depending on progress of our goals.
Currently we have a treasury of $2.1M (excluding DIKO tokens) that will be used to compensate core contributors and run the protocol. In the future, protocol revenue will first be used to pay core contributors and community managers.
Number of Twitter and Discord
We have a small and passionate community on Discord of about 1700 members.
The Arkadiko Twitter account has just under 7000 followers.
No paid ads or any money has been spent on marketing. This is all organic growth.
Focus: basics built, next is USDA utility & partnerships
Our focus in 2021 was getting the protocol deployed on mainnet and getting the basics done (meaning stablecoin liquidity out there + swapping operational). Our vision is, and remains, to build a bright DeFi community on the Stacks blockchain, eventually tapping into Bitcoin. The Swap has been a byproduct of the stablecoin, since no DEXes existed when we were building and eventually launched USDA. Our main focus for 2022 remains spreading the word on USDA and improving USDA utility. Anything that happens on the Swap is great, but it is likely that other players will eventually build better AMMs. Our dominance should come from stablecoin liquidity and acceptance of USDA in other protocols.
To do that, we will be partnering with the best DeFi protocols on Stacks, and eventually go multi-chain. Multi-chain is probably not something for the first half of the year (and perhaps not for 2022 at all). USDA is currently trading on Arkadiko Swap and StackSwap. We have a few exciting partnerships in the pipeline that are still a work in progress, but more on this within the next two weeks.
I’d like to add that our peg is not super relevant today, as this is measured as the STX/USDA vs STX/USD price coming from the BAND Protocol oracle. Since Stacks finality is slow, a block can be easily 10–20 minutes and it’s not easy to make sure your TX is included in the next block. Predictability is still too low, meaning an oracle (and thus peg) price can easily be a few hours to a day old. This currently makes arbitrage hard. We will see significant improvements of this as subnets go live on Stacks this year.
As USDA utility goes up, there will be more use cases for it. There are a few things in the pipeline and the team is very optimistic about USDA usage in 2022.
The biggest milestones were probably the launch itself, xBTC swapping and generally validating the protocol on Stacks. We believe USDA has strong product market fit but needs to be polished UX wise, and generally Stacks DeFi adoption will take some time (due to some of the challenges mentioned in previous bullet).
2022 High-Level Goals
1. Improve LTVs on STX-A and STX-B (currently 25%)
2. Introduce xBTC as a collateral type with 25% LTV
3. Improve LTVs on xBTC, STX-A, STX-B collateral types
4. Form USDA integrations/partnerships with high-profile projects. Currently we have one great project in the pipeline.
5. Improve strength of USDA peg
We don’t have specific TVL or revenue goals as this is unpredictable. If Stacks does a 10–50x in active users, then our TVL should probably do something similar (else we’re not performing as well as we should). We see our success correlated to Stacks growth, and so user growth and strategic alignment of our goals are related to this. We want to make sure the best devs and DeFi users eventually come to Stacks.
Finally, we can’t wait to announce our next partnership, currently finishing up a deal that should be public in the next two weeks. This will also drive new demand to USDA.