LD Capital Short-term Fund Analysis of 0x Protocol

In-Depth Analysis of 0x Protocol by LD Capital Short-term Fund

Author: Jill, LD Capital

Project Introduction

0x Protocol is an Ethereum-based smart contract for trading. The project was established in 2016 with a model of off-chain order book settlement. This settlement mechanism makes off-chain relayers the B-side users of the 0x protocol. Currently, there are 78 relayers integrated with the 0x protocol, including DefiLlama, Metamask, Coinbase, etc.

In 2020, 0x officially launched DEX Matcha based on the 0x API protocol.

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Source: 0x Browser, LD Capital

Fundamentals

0x Protocol’s governance token ZRX has a total supply of 1 billion. The current circulating market capitalization is $38.41 million, and the token is close to full circulation. The trading volume in the past 24 hours is $280 million, with a high turnover rate.

Source: Etherscan, LD Capital

According to on-chain data from etherscan, the top 30 large holder addresses account for 63% of the total, and centralized exchange addresses account for about 19%. Among them, Upbit address holds 10.9% of the total ZRX tokens, making it the largest holder on the ZRX chain.

Source: Etherscan, LD Capital

According to nansen data, the Upbit address has increased its holdings by around 4 million tokens in the past month, with a growth of 3.7%. Another Upbit address has also increased its holdings by nearly 4 million tokens in the past month, with a total holding ratio of 11.37% on Upbit.

Source: nansen, LD Capital

Several small whale addresses have been accumulating in the past month, with a holding ratio of 1.33%.

Furthermore, the large holder address 0xbdc transferred 1 million tokens to Coinbase a month ago, but other large holder addresses have not shown any significant abnormal transactions in the past month.

Source: nansen, LD Capital

According to the historical transfer records of the 0xbdc address, the address received these tokens in December 2022 and started selling them to Coinbase in January this year. The address currently has a remaining balance of 7.43 million tokens, which may create potential selling pressure.

Trading Volume

According to Trading View data, Binance spot trading volume started to increase on October 9th, with concentration of chips in the range of $0.25 to $0.33, and has already broken through the resistance zone. The concentration of chips within the current price range is relatively low, and the resistance is relatively small.

Source: Trading View, LD Capital

Contract Data

Binance launched the ZRX contract on June 29, 2020. From the current contract data, it can be seen that around 1 pm on November 11th, the ZRX contract positions started to increase, and active buying volume also increased to some extent. However, the long-short ratio and the large players’ position ratio are both less than 1, indicating relatively bearish sentiment from retail investors and large players. As a result, the active selling volume is relatively large. From the contract data, there is no clear signal for contract positions.

Summary:

ZRX has recently been interacting frequently with Upbit addresses, and there has been a significant increase in Upbit address holdings, indicating relatively active trading. There is no clear signal for contract positions from large players’ on-chain addresses, and there are no major positive fundamentals in the near term.

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