I have been working on analyzing the DPI user base. I wanted to share the initial insights with the community for feedback, questions, and open discussion. What are we learning about our users? What are we learning about DPI as a product?
Key Results
-
DPI is experiencing the largest growth in the holder base with addresses that have exposure to <10 DPI. This bodes well for DPI’s value prop as the simplest way to start investing in DeFi.
-
Addresses with <10 DPI account for >75% of the holder base. This strongly suggests that the Index Coop can generate consistent, long-run growth in AUM by targeting small DPI holders.
-
The 75% of address with <10 DPI account for roughly the same amount of AUM as the handful of whales. Addresses with 10-249 DPI account for only 25% of total AUM.
-
In aggregate, addresses are increasing their exposure to DPI by nearly 80% in the first 50 days after initial exposure.
-
Retention across all DPI holders is improving. DPI is becoming more sticky over time. This is a great sign for DPI’s value prop as the simplest way to maintain exposure to the best assets across DeFi.
-
Retention overall is driven by increased retention in holders with < 50 DPI. For addresses with 50-249 DPI, there appears to be slight evidence that retention is improving, though not as strong.
-
Whales (250+ DPI exposure) have the most variability in retention across cohorts and over time. While retention is still strong (~70% at 30 days), there may be leading evidence that DPI is becoming less sticky for newer whales. This may be due to shifting yield farming / LP opportunities.
DPI Users & AUM
DPI is experiencing the largest growth in the holder base with addresses that have exposure to <10 DPI. Although, it should be noted that there appears to be solid growth across all exposure groups in January. This bodes well for DPI’s value prop as the simplest way to start investing in DeFi.
Addresses with <10 DPI account for >75% of the holder base. This is important to understand as Index Coop evaluates how to best grow DPI as a product. It is likely that these holders are generally newer and have less money in “crypto” broadly, although more analysis needs to be conducted to confirm that hypothesis.
The 75% of address with <10 DPI account for roughly the same amount of AUM as the handful of whales. Addresses with 10-249 DPI account for only 25% of total AUM.
DPI Unit Retention/Growth
Another great sign - aggregated across all addresses and anchoring on the day of initial exposure to DPI, addresses are increasing their exposure to DPI by nearly 80% in the first 50 days after initial exposure. This may be one of the most intriguing findings so far.
DPI Retention
It appears that DPI is becoming more sticky over time as newer cohorts are achieving higher retention. This is a great sign for DPI’s value prop as the simplest way to maintain exposure to the best assets across DeFi.
DPI Exposure Retention looks very strong for addresses with <50 DPI. It should be noted that we are dealing with much smaller samples with holders having exposure to >50 DPI (see DPI Holders Growth chart). One hypothesis could be that early holders with large exposure to DPI were driven more by yield farming opportunities than holders with smaller exposure to DPI, and that there is more variability in retention for holders with larger exposure to due shifting yield opportunities.
While the previous views look at whether or not a “whale” (250+ DPI exposure) retains any exposure to DPI, this view looks at whether or not the whales retain as whales. There may be some leading evidence here that DPI is becoming less sticky for newer whales. Again, this may be due to shifting in yield opportunities with DPI.
Outstanding Questions
- What is the breakdown of where whale DPI sits? Uni/sushi pool? In a wallet?
- Can we better understand how whales are using DPI differently than small-wallet DPI holders (those groups dominate AUM)?
- For DPI holders, what fraction of their wallet holdings does DPI represent?
- Please ask more!