A Polkalytics study by Tommi Enenkel (Alice und Bob), Twitter, LinkedIn
This report covers Polkadot & Kusama parachain netflows until March 2023. It will first introduce the concept of exchange netflows and extend the concept to parachain netflows. It will then present visuals of Polkadot and Kusama parachain netflows from the launch of parachains until March 2023 and highlight some insights.
Notably, we observe the occurrence of spikes in strong inflows, closely followed by outflows of the same amount. Polkadot parachains tend to be conservative and have very low volatility in netflows, with the exception of Moonbeam. Kusama parachains are more chaotic with higher volatility and more frequently changing ranks.
The report is accompanied by the source code to produce the visuals and the dataset to produce them, as well as an outlook for possible future work.
This analysis started out with the question of how DOT and KSM are moving between Polkadot and Kusama parachains. Visualizing netflows can answer several questions:
To perform the analysis, a full history of balance changes of the parachain sovereign accounts was taken, capturing every single point in time the DOT balance of a parachain changed.
Capturing the full history of balance changes allows for the highest possible granularity of netflows and ensures that even short-lived deposits are captured in the analysis.
<aside> 💡 Polkadot makes use of reserve-backed transfers, where DOT is sent to a dedicated parachain account (the “sovereign account”) of a parachain on Polkadot and is then minted on the parachain.
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DOT Balance over Time on Polkadot
This chart presents DOT balances over time on Polkadot for different parachains with a balance of at least 10_000 DOT at the time of the last snapshot.