2023 Review

We started drafting this post on December 20th, 2023. A year ago, on the very same day, we finished writing the annual review of 2022, and the last section reads like this:

After launching on Arbitrum, the development team got to work on a new product, the Integral atomic relayer. The relayer allows traders on DEX aggregators to take advantage of SIZE liquidity to do instant trades at the previous 30-minute TWAP price. We have already deployed the relayer on mainnet and started integration with some aggregators. Look for much more to come on this in the year ahead.

“Much more” could be a Freudian slip (usually we say “look for more”), but the truth is, the relayer has exceeded anyone’s expectation by far. Exactly 12 months after the relayer was released, Integral is the 9th most utilized decentralized exchange on Ethereum mainnet (source: DefiLlama), with an accumulated trading volume of $1.7bn. Things also look promising for our Arbitrum version, which we believe will replicate the success of Ethereum’s.

It’s been a really long year, and we’ve got lots of reflections and gratitude to share. But before getting to that, let’s dive into the 5 most important milestones we had this year.

Milestones

Integral Relayer: Our Major Leap

The Integral Relayer stands as our crowning achievement this year. This innovative smart contract has processed ~$1.2 billion in volume, showcasing exceptional quote competitiveness and capital utilization.

Not just limited to aggregators like 1inch, OpenOcean, Odos, OKX, and UniDex, the relayer has also been tapped by top CoWSwap solvers like Barter and OTEX, and even attracted interest from indie developers who might be building their own MEV bots😈.

A year of growth for Integral, fueled by relayer, gas optimizations, and new integrations.

LP fee distribution

In the last quarter, we embarked on a pivotal enhancement for Integral by rolling out a new LP system. This system fundamentally changes the way our LPs benefit, enabling them to directly earn 100% (tweakable) of the trading fees from Integral pools.

Apart from this, being a LP at Integral comes with other significant advantages, including mean-0 impermanent loss (IL)and superior capital efficiency. It’s worth noting that Integral has now become the most capital-efficient Automated Market Maker (AMM) on the Ethereum network.

Integral is the #1 AMM in terms of capital efficiency.

What’s more exciting is the added capability of this system to distribute arbitrary ERC20 tokens as farming rewards. This feature positions Integral as an ideal platform for projects seeking to bootstrap their on-chain liquidity and enhance their quote competitiveness.

Gas optimization

A major upgrade across all contracts on both Arbitrum and mainnet has reduced gas usage per atomic swap significantly. This optimization further enhances our competitiveness, winning flows from aggregators and solvers for Integral LPs.

Arbitrum ramp-up

Our focus on Layer 2 led to the deployment of key features on Arbitrum, including the atomic relayer and the new LP system. Currently, the Arbitrum version is processing ~$0.75mil volume with less than $0.2mil TVL everyday. With these advancements, we foresee Integral becoming a crucial liquidity backbone on Arbitrum.

Towards a pro suite for trading

Our vision to transform Integral into the “Uniswap for Pros” is taking shape. The addition of atomic swap and limit order (testnet) to our existing features like the price comparator is a testament to our commitment to versatility in Ethereum trading.

Reflections and look ahead

Reflecting on the past year, we’ve faced challenging market conditions. In Q3 2023, Ethereum’s daily volume fell to about one-third of its Q1 volume, posing a significant challenge across the crypto industry. This underscores the longer, more complex journey to achieve product-market fit. At Integral, our focus remains on developing a sustainable product for on-chain trading, serving both traders and liquidity providers.

In the first half of our journey, Integral achieved our goals. In 2023, we enhanced the trader experience and gained a top-tier position among DEX platforms. Entering 2024, our priority is sustainability, meaning we’ll leverage our composability and deepen our industry roots. This includes collaborations with more token projects, Layer 2 ecosystems, and aggregators.

Effectively serving LPs remains a crucial yet often overlooked aspect of DeFi. Therefore, in the second half of our journey, we aim to assist token projects in improving their on-chain liquidity.

In Q4, we introduced a new LP system, enabling LPs to earn trading fees and token incentives. This new rewards system, coupled with our capital-efficient design, seeks to create a positive cycle involving LPs, token projects, aggregators, and Integral:

  • LPs: higher yield → more liquidity.
  • Token projects: more liquidity → more competitive quotes.
  • Integral: more competitive quotes → more flows from aggregators, solvers, and traders.
  • Aggregators, solvers, and traders: more usage of Integral’s liquidity pool → higher yield for LPs
Integral amplifies on-chain liquidity, aligning LP with DeFi’s sustainability.

While it’s clear how LPs and Integral benefit as a DEX from these initiatives, it’s important to emphasize the advantage for token projects using Integral to increase their tokens’ on-chain liquidity. Despite Uniswap’s introduction of concentrated liquidity improving capital efficiency and pricing, it remains underutilized, often due to the complexity for LPs in managing liquidity actively. Integral simplifies incentivizing concentrated liquidity, offering token projects an easier way to strengthen their on-chain presence, offering a streamlined solution for token projects to deepen their on-chain liquidity.

With the building blocks accumulated over the past few years, Integral is poised to offer a hassle-free management solution for concentrated liquidity. Token projects need only create a pool on Integral, add token rewards, and reap the benefits of concentrated liquidity. This approach ensures not just liquidity, but its optimal placement in active trading ranges, leading to competitive quotes and reduced on-chain slippage.

As stated at the beginning, the on-chain spot market will continue to present challenges in 2024. The only way a DEX can address these issues is by building a sustainable product—providing traders with less slippage, LPs with capital efficiency and high yield, projects with ways to deepen their on-chain liquidity. As Integral’s product offerings meet this standard, a DAO launch and tokenomics overhaul will naturally follow.

Thank-you notes

  • To 1inch: for being the first aggregator to integrate us
  • To Odos, OpenOcean, Barter, OKX, OTEX, UniDex: for channeling lots of volume to us
  • To DefiLlama: for creating up-to-date leaderboard of DEX volume that makes the journey so much fun
  • To Uniswap: for being the platform that provides us a robust price oracle, and we are super excited to work with you guys on v4
  • To all friends who are currently integrating us: let us know if you need any help!
  • To our traders and liquidity providers: for using the product extensively and constantly provide feedback.

Tags

Integral Insights

Updates

May 9th, 2024

Integral Insights April ‘24

The combined average daily volume across Ethereum and Arbitrum is now at 8.8 million USD, a remarkable 22% increase compared to last month.

Product

April 25th, 2024

Introducing New Pool Analytics: Elevate Your Liquidity Provision Experience

A standout feature in our latest update is the "LP vs Hold" tab, which provides a comparative analysis of various holding strategies against Integral's LP positions.

Business

April 1st, 2024

Integral Insights March ‘24

We achieved several important milestones, including a new all-time-high daily volume for Arbitrum and the addition of four new pools on the Ethereum mainnet.

Updates

March 4th, 2024

Integral Insights February ‘24

Another milestone was reached on February 21st when Integral processed over $2 billion in cumulative volume.

Updates

February 1st, 2024

Integral Insights: January ‘24

Our initial launch with the ETH-RPL pool was a success, quickly elevating us to the second most utilized liquidity pool for this pair’s trading.

Research

January 17th, 2024

Is Liquidity Fragmentation Really That Bad?

When the token evolves into a store of value, it attracts outside traders, focusing on trading costs and slippage. This is when concentrated liquidity truly shines.

Updates

January 2nd, 2024

2023 Review

At Integral, our focus remains on developing a sustainable product for on-chain trading, serving both traders and liquidity providers.

Updates

December 12th, 2023

Integral Now Rewards Liquidity Providers with Trading Fees on Ethereum Mainnet

This enhancement enables liquidity providers (LPs) to directly receive a portion or all trading fees from Integral pools.

Updates

December 6th, 2023

Integral Insights: November ‘23

During November, Integral processed an average of approximately 6 million in volume with around 1.5 million in TVL. The system’s overall capital utilization sits at around 350%. It is the 10th most used DEX on Ethereum.

Updates

November 28th, 2023

Integral Now Rewards Liquidity Providers with Trading Fees

This enhancement enables liquidity providers (LPs) to directly receive a portion or all trading fees from Integral pools.

Research

November 15th, 2023

How Do University Blockchain Societies Gain So Many Votes?

Explore how university blockchain societies like FranklinDAO and Michigan Blockchain have grown into influential players in DAO governance, utilizing delegated votes and strategic partnerships to shape the future of DeFi protocols like Uniswap, Compound, and Aave.

Updates

November 6th, 2023

Integral Insight: October ‘23

We give an update for our work in October and highlight a profitable LP position from a long-term user.

Research

October 26th, 2023

Understanding the Stakes in Lido’s Growing Share of Staked ETH

The community is arguing whether a protocol may have too much control over the Ethereum network. Lido controls a large percentage of staked ETH, which could have consequences for the network’s future security and neutrality.

News

October 14th, 2023

Changes to Staking and Farming

Looking back at our progress so far and to the future with new updates to staking and farming.

Updates

October 11th, 2023

Integral Insight: September ‘23

We give an update for our work in September with utilization going up on higher volume for our new pools.

Research

October 11th, 2023

The Hottest Narratives of the Summer

What were the hottest narratives of the summer? Our DeFi research team delves into the growth of trading bots, RFV traders and more in this overview.

Research

October 2nd, 2023

Uniswap Governance: A Deep Dive

Governance is considered a critical component for the decentralization and community-driven development of DeFi protocols. We take a look at one of the largest goverance ecostystems in DeFi, Uniswap. In this blog post, we'll discuss the landscape of Uniswap's governance, pulling data from empirical research to dissect the system's delegates and proposals, revealing some interesting findings.

Research

September 19th, 2023

What is the DAI Savings Rate (DSR)?

Our research team takes a look at the DAI Savings Rate and its influence on various yield dynamics in DeFi.

Updates

September 15th, 2023

Integral Insight: August ‘23

We give an update for our work in August with cheaper gas fees and the launch of the Integral Relayer on Arbitrum!

Product

September 7th, 2023

Integral Relayer Launches on Arbitrum

We are excited to announce the launch of the Atomic Relayer on Arbitrum. This will bring the efficient and tested system for atomic trades to the Arbitrum Layer 2 network!