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DEX Traders PnL: Profitable Wallets Trading Narratives
Xin Yi Lim
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Key Takeaways
9 min read

  • Traders made outsized returns from AI tokens more than any other narratives (LSD, App-chains) in January 2023.

  • Traders who made the most profits in terms of percentage change tend to have smaller capital holdings, lesser trades, and caught the narrative earlier than the rest of the market participants.

  • In general, wallets are largely still active in trading the market, having most of their funds held in their wallet rather than looking for yield in protocols.

  • Most wallets are still not fully risk-on given that a significant portion of their funds are still held in stablecoins or ETH. However, some traders have been moving their realized profits into different tokens - mainly lower cap tokens.

  • Some wallets are still holding onto tokens from current narratives (AI, LSD), others have shifted to NFT-fi and Arbitrum tokens such as LOOKS, X2Y2 and GRAIL, RDNT and VELA. Other tokens that traders have accumulated positions include FLEX, SNX, FTM and MATIC.

Introduction

Our new Tokens Paradise dashboard contains a DEX PnL leaderboard that can help surface interesting wallets. With the current volatile market structure, token prices move very quickly depending on narratives. Hence, it is important to utilize on-chain data to further investigate top wallet activity for discovery and defense. This report focuses on the most profitable wallets trading narratives in the past month and what they are looking into next as a rotation.

The analysis will be segmented to different baskets of tokens - namely LSD, AI, and app-chains tokens based on narratives in the past month. We will also look into the wallets’ current positions to see if we can spot any patterns of a next rotation.

Analysis of...