July Review — #OHMISBACKED
July met and continued to exceed expectations. To get an idea of how the system is growing, let’s again review our protocol metrics.
- Treasury Risk-Free Value +$13.7m (↑144%)
- Treasury Market Value +$38.4m (↑115%)
- Highest Revenue in Industry
- Lowest Market Cap/Revenue ratio in Industry (14.1x lower than next lowest)
- Lowest Market Cap/Protocol Revenue ratio in Industry (44x lower than next lowest)
The Charts n’ Numbers
First up we’ve got the Realized Value of the treasury. This number measures the USD value of our treasury. This has no price risk — it is the minimum USD value of the treasury, barring an exploit or loss of peg on DAI or FRAX.
RV more than doubled in July, rising from $9.5m to $23.2m.
Market value rose similarly, going from $33.3m to $71.7m. The market value of the treasury is a more volatile metric because it includes the market value of treasury-owned LP shares, which change in value along with OHM price.
Both of these have led to a considerable increase in backing per token. (+$8.45/+44%)
Despite balances increasing by 48%.
Combined, we can see the index-adjusted backing per token. This takes balance increases into account, and provides a more consistent measurement of value accrual.
Liquidity also rose significantly over the month, going from $29.2m to $48.2m. This accumulation has accelerated in recent weeks with a greater emphasis placed on it within policy.
You can see the comparative growth of the aforementioned metrics here.
The previous metrics feed into overall revenue. This is the amount of capital taken in by the protocol, measured as market value at the time of acquisition. In the case of networks like Uniswap, Sushiswap, and Bancor, revenue comes from trading fees. For Aave and Compound, it comes from interest. For Olympus, it primarily comes from bonds.
Annualized, it looks like this:
While pure revenue is a great metric, it doesn’t tell the whole story. This metric includes both fees accruing to the protocol, and fees accruing to users (liquidity providers, lenders, etc). If we want to look at this data to analyze the value accrual of the network itself, its more accurate to use Protocol Revenue (revenue excluding what gets paid to users).
You can see that, for the month of July, Olympus had by far the highest protocol revenue in the industry. (Note: this does exclude Axie). Annualized, it looks like this:
Finally, let’s put it in the context of network values. Here we have the market caps of each protocol.
Here is the market cap to annualized revenue ratio: (if a protocol has a market cap of $1b and will take in $100m this year, this number would be 10).
Here is market cap to annualized protocol revenue, which measures how much value is accruing to the token relative to the market cap of the token.
Next we have market cap versus the realized value of the treasury. This can be thought of as our fractional reserve rate. The higher it is, the higher the fractional reserve. We saw a steady deleveraging throughout the month.
An alternative measurement for the same thing is market cap versus the market value of the treasury. It tells a similar story.
Our trading pools brought in over $900,000 through trading fees.
Farming in the Onsen program brought in an additional $200,000 in $SUSHI.
DAI deployed in Aave brought in an additional $1,700 in $aDAI and $stkAAVE