UMEE Network - Global overview and user metrics

The methodology used for retrieving data is leveraging Numia data for all charts and data, unless specified otherwise, since some data is already available either in Astrolabe or the general app.

Introduction

UMEE is a lending algorithm built as a blockchain. As a base layer blockchain secured by a decentralized validator set, anyone with an internet connection is able to access Umee's services. Umee is permissionless, meaning anyone can access debt markets on Umee regardless of things like their location or financial history.

All Umee users must be properly over-collateralized at all times in order to borrow funds. Users who fail to remain properly over-collateralized will have their collateral liquidated in order to minimize risks of insolvency and provide a high degree of security to lenders.

Once the foundational interest rates are built, the crypto format for debt primitives such as notes, bills, bonds, CDS, structured products, and other assets can be built on top of Umee.

Although this report is not focused on UMEE token, it’s essential to know the basic economic use of it, which will come towards the end of the report.

Transactions

Let’s go straight to the juice. The number of transactions on UMEE are always very high; if one takes a look at mapofzones, it has around 500k transactions per day.

For instance, if we take the first day of 2023, it had a total of 719063 transactions. However, 550k of those are aggregate exchange rate vote and rate prevote, and that seems to be the reason behind the high number of transactions. Those actions come from the oracle module, as prices per exchange rate are submitted on-chain via pre-vote and vote messages using a time-weighted average price (TWAP).

With regards to transaction fees, throughout the whole of 2022 and 2023 so far there have been 243k UMEE spent for transaction fees, and that’s around $1.1k with the current price.

IBC Transfers

IBC transfers happen between two IBC connected chains, and is a way of measure the transfer between them and how much they are connected.

The number of IBC transfers per day has decreased since inception, reaching a peak of around 30k transfers in a single day on September 2022, to around 2k IBC transfers daily currently.

Depositing and Borrowing

The number of available assets for depositing and borrowing has been increasing steadily in UMEE, to reach around 20 assets.

In that regard, numbers are pretty clear; there has been a huge demand for supplying and borrowing in UMEE despite market conditions; numbers are around an ATH on both sides, reaching $13.2M USD supplied and $4.2M borrowed.

Figure taken from UMEE website

The number of users depositing is also reaching a steady amount, reaching up to 140 users depositing daily and currently sitting at around 40-60, and with stATOM, USDC and ATOM being the most used assets.

Revenue

The sources of revenue are:

• Transaction fees

As seen in the first section, transaction fees are very small, reaching only 243k UMEE in almost two years.

• Validator commission

Validator rewards will depend on their commission. For instance, top 1 validator with a 20% commission is receiving around 18M yearly UMEE (roughly $74k atm). A top 20 validator with 5% commission is earning around 500k yearly UMEE (around $2k), and so on.

• Oracle rewards

After researching a few more and reaching out to devs on UMEE, this part is not yet clear on instructions regarding the way of querying it, so I will not speculate with them for the moment.