L2 vs Mainnet : Better Slippage

Over the last few posts we have been looking at trading venues on Arbitrum to see how whales are doing large trades.

In part one, we looked at overall volume and the type of tokens being traded. Sushi started with a lead in terms of volume, but Uniswap v3 concentrated liquidity took over larger volume trades.

In part two, we compared slippage on Arbitrum between Uniswap and Sushi. We found a surprising number of large trades on Uniswap v3, especially for native tokens like GMX and MAGIC.

Now we can compare trades between Arbitrum and mainnet. Are traders getting more slippage on average? Are whales taking advantage of the available liquidity on Arbitrum to make large trades? We will take a look at these questions in this piece for the WETH-USDC pair.

The WETH-USDC pair is one of the largest and most heavily traded pairs on both Arbitrum and Ethereum mainnet. This makes it a good proxy for whale activity and size.

Starting with Uniswap on Arbitrum where we have seen more large volume trades from whales. From all of our Arbitrum trade data, there were 553,048 trades from WETH to USDC and 493,149 trades from USDC to WETH. The average amounts traded for were $8,255 and $9,317 respectively. In total Uniswap processed over $9b in volume on the WETH-USDC pair since launch.

Meanwhile on Mainnet, $9b in volume can pass through the .05% Uniswap v3 WETH-USDC pool in a week. Over $200b in volume has traded in the mainnet pool since September 2021 when Uniswap on Arbitrum picked up initial volume.

Source: Dune Analytics

The enormous difference could come down down to the liquidity available. The WETH-UDSC pair on mainnet has sometimes contained more capital than the entire Arbitrum chain.

What about slippage? The 0x team published a great blog that showed slippage increased during times with volatile token prices.

While this is an expected result, we can also compare slippage on Arbitrum during volatile price action. Here we can see a similar chart for the largest positive slippage trades on Arbitrum. We’ve also pulled just trades from April until the end of June:

We can see that as volatility picked up in May, with many more high slippage trades during the heavy volatility days surrounding the UST collapse.

We are still left then to speculate about why whales are not moving to L2 networks like Arbitrum. Some are sure to be used to the security and familiarity of mainnet. But even mainnet liquidity and volumes don’t keep some traders from experiencing high slippage.

We think that the more innovative and unique projects live on L2 networks, the more reason whales will have to migrate.

That is part of the reason we’re bringing Integral SIZE to Arbitrum. SIZE will provide a toolset for whales and others navigating the Arbitrum ecosystem. SIZE offers…

  • TWAP execution and 0 price impact trading for any order size
  • MEV protection
  • Mean-zero impermanent loss for liquidity providers

This comes alongside the lightning-fast and inexpensive transactions already a staple of Arbitrum. We’re excited to see how the Arbitrum ecosystem takes advantage of SIZE to improve their trading experience.

If you would like to discuss the above topic more in depth or want to suggest a new topic, please connect with our team and community in Discord.


Integral Insights


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.


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.


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.


March 4th, 2024

Integral Insights February ‘24

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


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.


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.


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.


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.


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.


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.


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.


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.


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.


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.


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.


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.


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.


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.


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!


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!