Monthly insights into the performance of Ethfinex
With an aim to provide our users with a clearer view of the inner-workings of a digital asset exchange, we publish monthly reports reflectiang the trends of each previous 30-day period.
Following an extensive period of internal testing, the much anticipated Ethfinex Trustless was launched into the wild earlier this week.
Ethfinex Trustless allows for the trading of Ethereum assets from a private wallet, without first needing to transfer custody of funds to Ethfinex itself. In an industry first, users can face the liquid centralised order books of Ethfinex & Bitfinex and execute trades lightning quick, without having to compromise on security or privacy.
If you haven't already tried out Ethfinex Trustless then we encourage you to take it for a spin here.
The industry reaction has been overwhelming. As well as being featured on many crypto news outlets, the pouring in of private messages of support has been fantastic. A big congratulations to everyone involved in the launch, both internally and externally.
Community Vote Changes
The ninth community voting round completed this week, with ContentBox, Content Neutrality Network and VideoCoin scheduled to be added to Ethfinex and Bitfinex.
We have been in contact with hundreds of token teams over the past five months and have generated a wealth of data and feedback on the end-to-end voting process. As a result, we have made a few changes.
Starting this week:
- Delegates - users can opt to give a delegate control over their EVT (for voting purposes only). Delegates can put themselves forward and outline their policies on the delegates pages.
- 50% EVT carryover - tokens that do not make it into the top three are credited with 50% for the next voting round.
- Partial voting - users can now split their votes across multiple tokens. The list of competing tokens grows each round, instead of being removed and cycled.
This following report breaks down monthly trading revenues, volume and user growth, and will continue to provide more detailed statistics each period. The performance period covered in this report is 12th August 2018 - 11th September 2018.
- Total trading volume for the period equalled $555m, a simple average of $17.8 million per day, a decline of 25% from the previous period.
- Total trading fees of ~$411,545 (depending on price feeds) were collected through trading and other fees in the 30-day period.
- In line with this, 641.2 ETH have been contributed to the Nectar token contract, pledged to NEC holders.
- 629,417 NEC tokens were distributed to reward market makers active on Ethfinex in the past month. Statistics can now be viewed on Nectar.community.
Month in Review — September
Revenue & Activity Reports
1. Trading fee revenues
All fees were converted as they were collected into ETH to provide an averaged conversion cost across the month and average out the effects of price volatility during the period.
Fee currencies in the table are ranked in order of most collected. Quick note — fees cannot be extrapolated directly to trading volume as users can set their preferred fee currency (hence the popularity of USDT and BTC).
The above chart shows 50% of fees in all currencies collected. 641.2 ETH were collected during the month and pledged to NEC token holders. NEC, MAN, EVT and DAI all performed relatively well.
2. Trading Volume
The total 30-day trading volume dropped 25% to $555m as the ETH/USD price fell 18% and alt token markets suffered much more. With many token projects in ‘build mode’ the immediate utility is limited. With many traders underwater and ‘bag holding’ we don’t expect natural volume to return to many projects until there is a wider market recovery.
User numbers, page visits, and conversions have all been broadly similar to last month. This bucks the downturn in the wider market, as ETH/USD fell to a 12 month low and the daily volatility of ETH/USD pair dropped 18% to one of the lowest monthly averages of the year.
Treading water in the current market is not to be sniffed at, as other exchanges (and new exchanges) are haemorrhaging customers and bleeding cash. Ethfinex’s strategy of lean operations, community focus and continued new product innovation is paying dividends and should hold us in good stead for when the bull market returns.
Peak daily trading volume was 36.9m, down slightly from the month before.
The Month Ahead - October
The Ethfinex Governance Summit
The first Ethfinex Governance Summit is quickly approaching and is already oversubscribed. Held in Lugano, Switzerland on the 29th -1st October, 90+ guests will come together to discuss and debate models of distributed governance. Experts from Ethereum, Giveth, Human Rights Foundation, Kleros, Melonport, Aragon, Procivis, POA, Consensus Clubs, Bitfinex and many more are attending what should be a very lively weekend.
The first two days of the event will be split into presentations, panels and workshops, with the cumulation being the third day, where NEC community members will get together to map out the future of Ethfinex and Nectar token economics in an open board meeting. The aim is to take some of the proposals from the board meeting and turn them into proposals on which our wider community can vote on. This could be anything from fee changes, new features, new economics or new tech to benefit the NEC community.
Fee Schedule Changes
We have finished a large bit of work on fee schedule changes and other NEC economics, designed to encourage liquidity, increase the competitive of Ethfinex vs other exchanges, increase the circulation of NEC and support smaller token markets, whilst still protecting against bad actors (wash trading etc). These changes are part of a much wider plan to increase the utility of NEC. We will delve into some of the ideas in greater detail at the Governance Summit and if there are no objections we will implement them in the following weeks.
Given the state of the ICO market at the moment we have delayed the first of our planned token sales for a few weeks but hope to have the first project to live on the platform soon. The delay has allowed us to further improve the customer journey and back-end tech.
The Ethfinex token sale platform is designed to improve the user experience of token sales. The contribution process will be in the form of a random ballot. We think this is the fairest mechanism as it avoids the “fastest finger first” problem that sours many token sales. The advantages of contributing to a token sale on Ethfinex rather than an unknown ICO website is that is minimises the risks associated with protection of personal data, phishing, miss-typings and gas price errors.
Trustless Portal Expansion
We want to support and push the growth of Ethfinex Trustless as much as possible. We have a whole host of developer tools and guides ready to deploy that should make third party integration much easier. In addition, we will be adding new pairs to the portal and making improvements to the UI.
The first last few days of trading have seen significant volatility and volume across the board, which we hope signals that the worst of the ETH price falls are over. With the launch of Ethfinex Trustless, token sales and the Governance summit all happening over the next few weeks we are very positive that our growth will continue as we ‘break cover’. There are also plenty of projects, partnerships and new features that we aren’t able to talk about yet, but all of which should add a significant amount of new users, utility and trading volume to the platform.
As ever, if you have any questions then you can reach me on email@example.com or in the Ethfinex Telegram group.
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