DeFi on-chain analytics 🧐
DeFi on-chain analytics 🧐
On-Chain Analytics: Three Essential Tools for Informed Investment Decisions
Gm,
In this edition, we'll delve into three pivotal on-chain analytics tools I frequently use for investment decisions.
While investing in a new asset requires extensive due diligence beyond on-chain analytics, the full transparency of a public blockchain makes these tools incredibly valuable and not to be overlooked.
The value of onchain analytics tools
Just as with AI, it took me a while to fully grasp the transformative power of on-chain analysis.
When wielded effectively, these tools provide a distinct edge over other market participants, particularly during a bear market.
They illuminate who's building what, which protocols are in use, and the fees generated by various projects. It's an invaluable source of insider knowledge, fostering more informed investment decisions.
Arkham intelligence
I predominantly use Arkham Intelligence for my analytics on EOA or smart-contract wallets, primarily to monitor whale movements. Arkham is excellent in this aspect, as it provides real-time alerts when an entity you're tracking makes a move.
This tool is extremely effective for conducting on-chain analytics.
DeFiLLama
I also like using DeFiLlama for tracking DeFi projects.
It allows me to access crucial data such as fees generated by a project, which is tied to its tokenomics. This information is essential in assessing a project's sustainability.
Additionally, DeFiLlama categorizes projects, making it easier to track specific interests. Currently, I'm keen on LSDfi, and if I want to check the treasury of Lido, for instance, I can quickly find it on DeFiLlama.
Another beneficial feature of DeFiLlama is its database of DeFi projects that are currently tokenless.
This allows you to easily identify potential high-value airdrops from projects with significant Total Value Locked (TVL), but no associated token yet.
Token Terminal
Likewise, Token Terminal is an exceptional tool for those interested in DeFi. It allows you to monitor the most active contracts, as demonstrated in the image below. Indeed, this feature is excellent for identifying active protocols within emerging blockchain networks.
Similarly, I use Token Terminal to track metrics like earnings, protocol-generated fees, treasury size, and daily active users.
This information is instrumental in deciding whether to invest. While there are other factors to consider, this provides a solid starting point.
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