Author: Rina from Medium
Let’s start with a brief introduction to API3.
API3 is an innovative first-party oracle that differs from other oracles in that its data does not need to be aggregated and relayed by third parties, but is provided directly by the first-party data source. This is achieved through the core component Airnode, which allows API providers to easily run their own oracle nodes without intermediaries and directly publish data sources (dAPIs) to any dApp interested in their services.
API3 is building the zk layer2 of OEV. OEV is a subset of MEV, referring to value that can be extracted related to oracles. When the oracle provides the latest price to DApps, there are opportunities for liquidation and arbitrage of assets. API3’s layer2 specifically captures the value of OEV and feeds it back to DApps to enjoy profits.
There have been many articles analyzing the future prospects of API3, but here, I will focus on some key data of API3.
TVS
The oracle project differs from DeFi, and one indicator to measure it is Total Value Secured All Oracles (TVS), which represents the security value of the oracle. According to Defillama data, API3’s TVS is $1 billion. In comparison, Pyth’s TVS is $4.8 billion. API3 and Pyth’s FDVs are $380 million and $3.8 billion respectively. So, if we compare market value based on TVS, API3’s current price is undervalued by about 2.5 times.
Let’s take a look at the historical changes in API3’s TVS. A very obvious feature is a significant leap in API3’s TVS in 24 years. In 23, TVS was around $10-20 million. After 24, there was a rapid increase. In January and February of 24, TVS saw its first increase from $20 million to $135 million. Starting from March, there was a leap in TVS, raising it to the range of $800 million to $1 billion. By late May, TVS was consistently above $1 billion.
From TVS perspective, API3’s entire project has made significant progress this year, with TVS growing nearly 50-100 times.
On-chain Data
According to on-chain data, API3’s total supply is 133 million tokens, with a circulating supply of 111 million tokens, accounting for 83.4%.
Analysis of large holders on-chain
Holder 1: API3 staking address
Holder 2: Binance exchange wallet
Holder 3: Treasury
Holder 4: Tokens transferred from the Treasury, possibly for specific purposes
Holder 5: Unmoved since 22
Holder 6: OKEx exchange
Holder 7: Coinbase wallet
Holder 8: Coinbase wallet
Holder 9: Upbit wallet
Holder 10: Kraken wallet
Currently, API3’s staked amount is 61.79 million tokens, accounting for 55.67% of the circulating supply and 46.45% of the total supply. Compared to other staking projects, API3 has a particularly high staking rate. Looking at historical data, after reaching 60 million tokens staked in February 22, it has consistently remained above 60 million tokens. During this time, it experienced a bear market in 22 and a bleak market period in 23. Therefore, most stakers are very optimistic about the project’s future.
In terms of overall token distribution, 61.55% is within the project and smart contracts, with the largest portion in API3’s staking contract, followed by uncirculated API3 tokens. Excluding this portion, the actual control of tokens by the project and smart contracts is not very high.
The API3 token does not seem to be heavily controlled by large whales, as 137 whale addresses hold only 18.51% of API3 tokens. This indicates a relatively decentralized token distribution, with large whales not holding a significant amount of tokens on-chain. In the past week, there have been no significant changes in API3 whale holders’ positions. Within centralized exchanges, API3 accounts for 14.74% of the total supply, which is at a moderate level.
Overall, from the on-chain data perspective, we can conclude that:
1) API3’s circulating supply is very high, and the main locked tokens are from the foundation, which require DAO voting for control. Institutions and project parties have long since unlocked.
2) From staking data, 60 million API3 has been staked for a long time, indicating that most people are very optimistic about the future.
3) Token distribution is relatively decentralized, with no major whales able to control a large number of tokens.
Key Data Analysis of API3