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Protocol Revenue and What it Tells Us

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Avatar for warliezdiaz
Written by   24
1 month ago

Token Terminal is the best website to use when monitoring protocol revenues. However, projects and even users misuse its charts to show to others which chain are active and are really profitable. While it may be true in some way, more of it is misleading.

Some users would tell others that Ethereum has the most profit among all chains and Axie Infinity among all Dapps. But then Ethereum has very fees in interacting to its smart contracts in addition to its very high gas fees. Thus, it has so much edge against its competitors. It's also given fact among all Ethereum-based Dapps including sidechains like Optimism.

Avalanche which burns all the fees, making it a deflationary asset is the fourth most profitable chain right now. The more Avalanche is being used, the more AVAX are being burned. Currently, it is burning more AVAX than emitting more AVAX as rewards to its validators and delegators.

The gas fee on Solana and Avalanche based on my experience are not really that far. Avalanche is much more expensive by a few cents. However, if both chains have the same fees, I think they will have the same figures or a very small difference as to their revenue.

Solana's hackathon program have greatly helped in its adoption and price action. One thing I noticed about Solana is that the projects being built or expanding to it for the last two months have slowed down a bit. It is on this aspect that Avalanche is catching up with the help of its Avalanche Rush Program.

Fantom also has a similar grant to developers a few months ago. It has greatly helped its price and give users more options to choose where to place their funds and earn bigger rewards. Personally, I feel that Dapps on Fantom are still limited when compared to Solana and Avalanche which has more than a hundred.

I do not expect Cosmos, Celo, Kusama and Polkadot to have that much revenue. Cosmos and Celo have of just a cent or even less. Cosmos has no other Dapp that directly uses its native token ATOM except Emeris. Celo has just recently launched its grant programs to developers, communities and startups to build on it.

On the other hand, Kusama and Polkadot are still not being used that much. Parachain auctions and crowdloans are still ongoing and those who secured their slots are yet to launch their working products.

(This is not a financial or an investment advice. Kindly do your own research diligently.)

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Avatar for warliezdiaz
Written by   24
1 month ago
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