After the Fei protocol fell short of expectations in early April, a lot of ink was poured into the doomed FEI stablecoin design and possible recovery options. Covalent’s latest findings in Cointelegraph Consulting’s monthly newsletter add to the debate a closer look at how Fay’s protocol drama comes to life with numbers.
Three weeks ago, the Fei Protocol raised 639,000 Ether (ETH) worth about $ 1.3 billion at the end of the formation event. The data shows that the event attracted 17,567 unique users, but it turned out to be dominated by whales. In fact, 241 titles, each containing over $ 1 million, account for 63% of the total ETH Genesis value.
Individual investors with portfolios of $ 500 to $ 5,000 represent the largest group in terms of the number of shareholders, accounting for 43% of shareholders, but only 1.24% of deposits. The third largest group by the number of shareholders consisted of 2,667 investors who invested less than $ 1 million in total.
The data shows that despite the modest contribution of investors with fewer shares in their portfolios, they have transferred the majority of their portfolios to the FEI. Meanwhile, whales are investing less and less in the phi protocol.
Was the request short-lived?
Fei Protocol introduced a new FEI stablecoin that uses a dynamic triggering mechanism to maintain proper connectivity. In simple terms, the main advantage of the protocol is that it includes a system that prevents users from selling the FEI when stablecoins are being traded under the thumb. The protocol launched a decentralized independent organization with TRIBE rule symbols.
The origins of the Fei protocol generated excessive market demand as a result of two interrelated factors in the construction of the correlation curve and the fall of the TRIBE control symbol. Many users hoped for a quick return, so they tried to buy the FEI at a lower price than they indicated they would receive the TRIBE codes as a reward. However, users who focused on the long-term development of projects also received a percentage of the Fei configuration they had allocated for TRIBE prior to the exchange.
The largest competitors who divided their original FEI assignment into TRIBE behaved differently from the smaller competitors. The data shows that the largest participants preferred to receive twice the FEI / TRIBE over the smaller headlines. The whales were hungry for the codes to control the protocols, and they got what they wanted.
Approximately three weeks after the Fei gene event, data indicate a decrease in the value of formation participants in each group. Despite the heavy burn penalties, there is no longer any currency in the names of the formations, they do not provide liquidity and do not store it.
All groups sold between 40% and 60% of their original value, resulting in an overall decline of 56%. Users with addresses ranging from US $ 100,000 to US $ 500,000 were the largest contributors to the FEI’s selling pressure after inception, with nearly 65% of the original value sold.
It is worth noting that the group with the smallest portfolio size came in second at the end of the protocol. In general, users with less capital (groups 5 to 10) were more likely to discontinue transporting the FEI than whales (groups 1 to 4).
Going back to comparing the FEI’s initial contribution to the size of the user portfolio, the post-formation comparison shows that the FEI struggled to get the club back from the outset, while TRIBE hit the rails at $ 1.33, down 43% from April, 4. peak.
After nearly three challenging weeks of the Fei Protocol, the overall value of the formation members has declined. What is important is that the distribution has stabilized in relation to the size of the portfolio, so there are not as many obvious deviations as it was at the time of Fay’s birth.
Specifically, in March, the Fei Protocol raised $ 19 million from major industrial venture capital firms including A16z, Framework Ventures, ParaFi Capital, and others. Several DeFi projects have also had fundraising rounds over the past two weeks, raising nearly $ 31 million from seven rounds.
However, due to about $ 245 million raised in 10 rounds of capital funding in the blockchain industry, only one transaction accounted for 49% of the total endowment capital. Overall, venture capital flows were down 43% from the previous two-week period.