Unpacking Drift’s Volume Explosion: Are Solana Perps Back in Business?

Over the past two weeks, the Drift perpetual swaps (Perps) has witnessed an extraordinary spike in activity, achieving milestones previously unseen since its launch. 

On July 18, Drift's daily Perps trading volume surpassed $1 billion for the first time, positioning it as the second-largest Perps platform globally, behind only Hyperliquid, and the leading platform on Solana.

Explosive Growth in Volume and Trade Count

Before July 8, Drift consistently averaged less than $200 million in daily Perps trading volume, with about 31,000 trades per day. However, from July 8 onwards, trading volume surged dramatically, growing five-fold to a peak of $1.08 billion on July 18. The number of daily trades also more than doubled, exceeding 81,000 trades—a significant leap indicating heightened trading activity.

High Volume, Limited Wallet Activity

Interestingly, despite the enormous growth in overall trading volume and transaction count, Drift's number of active wallets remains relatively low. Before July 8, daily active wallets ranged between 80 and 130. Although the count has increased to between 130 and 285 wallets daily post-July 8, it is still relatively modest compared to the massive volume figures.

This discrepancy has resulted in remarkably high average daily trading volumes per wallet. In fact, average per-wallet volume frequently exceeds $4 million daily, with even the lowest observed daily average around $880,000—substantially higher than typical user activity on comparable platforms. On July 18 alone, the average number of transactions per active wallet reached an astonishing 280 trades, averaging about 12 trades per hour per wallet.

API and Bot Dominance

One of the primary drivers behind Drift’s explosive trading growth is likely the robust API the platform offers. This API is particularly attractive to automated traders or bots, which execute rapid, high-frequency trades at volumes human traders would find challenging to match.

Over the past 14 days, these bots have dominated Drift's Perps trading environment, accounting for between 83% and 94% of all daily trades. On July 18—the record-breaking day—bots executed over 75,200 trades. Such an overwhelming proportion suggests Drift's recent surge is heavily automated, driven predominantly by algorithmic trading strategies.

Concentrated Trading Activity

Further examination reveals another aspect: trading activity is highly concentrated among a small number of wallets. Over the past 7 days, just the top 10 wallets accounted for more than 93.8% of Drift's total Perps trading volume. Wallets ranked 6 to 50 accounted for another 5.9%, meaning over 99% of total trading volume was concentrated among the top 50 wallets alone.

Trade counts paint a similar picture: Out of over 505,000 Perps trades recorded in the past 7 days, more than 449,000 were executed by the top 10 wallets. Another 50,000 were from wallets ranked 6 to 50, leaving a mere 4,788 trades executed by all other wallets combined.

Upon closer examination of these wallets, it becomes evident that they are predominantly associated with active strategy vaults on Drift. 

A prime example is the hJLP (USDC) vault, which, with a TVL exceeding $23.4 million, ranks among the platform's largest. This vault alone accounts for a substantial portion of the overall trading volume, with many of its affiliated wallets consistently appearing in the top 10 wallet rankings.

Strategy Vaults Drive Volume Surge on Drift Amid Zero-Fee Promotions

Strategy vaults appear to play a pivotal role in Drift’s trading dynamics. This could provide clarity on why trading volumes have surged nearly fivefold, while the active user base has only doubled. The disproportionate growth suggests that increased vault activity, specifically the higher frequency of trades executed by these strategy vaults, along with Drift's promotional zero-fee initiatives, are major drivers behind the recent spike in trading volumes.

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