From 2020 to 2021, the hot spot of the cryptocurrency industry lies in DeFi, and the value of DeFi is mainly deposited in DEX. The latest data shows that the number of independent DeFi users on Ethereum has just exceeded 2 million, while the average daily transaction volume of the DEX market has remained at around US$3 billion.
There is still the possibility of major changes in the DEX circuit. At present, users’ use of DEX is mainly based on the AMM spot trading scene, and the derivatives scene with greater potential has not been fully unlocked.
Although Uniswap is an out-and-out leading DEX measured from multiple dimensions such as market recognition, asset liquidity, and transaction volume, latecomers such as PancakeSwap have only been launched for more than half a year, and they have already caught up in the dimensions of transaction volume. Super power.
The development of DEX is at the right time, and this is a topic worth discussing. In this issue of the content, Beep News will compare DEX platform coins, on-chain transaction data, richness of DEX functions, gas fees and transaction fees, social media popularity, website visits, and search indexes to the five major DEXs— —Uniswap, PancakeSwap, SushiSwap, Curve, 1inch are compared horizontally, hoping to get a glimpse of the current status of DEX.
DEX platform currency has entered the ranks of mainstream currencies, Uniswap has obvious advantages
Data source: non-small number Statistics time: 2021/4/27
With the increase in the adoption of DeFi, liquid mining and 1D0 have become a boom, DEX has also ushered in the rise, and has become a competitor that CEX cannot ignore. Whether in terms of market value or currency price increases, DEX platform coins have the potential to surpass CEX.
As shown in the figure above, the 5 major DEXs in this study, their platform currencies have all ranked among the top 100 currencies by market capitalization. Among them, UNI is the first DeFi asset to enter the top 10, and it currently ranks firmly in the top ten. Moreover, the market value of UNI is in the order of tens of billions of dollars, which has a clear lead compared to other DEXs.
At the level of currency price increase, except for SUSHI, which has been affected by a large number of token unlocking, there has been a large decline. The overall increase of the DEX platform currency and CEX platform currency in this survey is relatively close.
However, Binance and Binance’s DEX, PancakeSwap, is more eye-catching in terms of currency price increases. BNB has increased by more than 11 times in 3 months, and CAKE has increased by more than 1.2 times in 3 months, which is nearly 2 times higher than the average increase of the same type of platform currency.
Data on the DEX chain began to explode in June last year, with fierce competition in transaction volume and user volume.
Data source: DeBank Statistics time: 2021/4/27
In June 2020, Compound unveiled the prelude of DeFi liquidity mining. Pledge farming and loan farming have become the most popular and gold-absorbing activities for cryptocurrency amber. At the same time, DEX’s on-chain data, including lock-up volume (asset liquidity), transaction volume, user volume, etc. have also started explosive growth.
The data source of the daily transaction volume changes of the 5 DEXs analyzed in this article: DeBank
Although in terms of asset liquidity and daily transaction volume, Uniswap and PancakeSwap are in a clear leading position, the competition on the DEX track is far from a foregone conclusion.
PancakeSwap (the dark blue area in the picture above) was launched in September last year and has been launched for more than 6 months. It has already rivaled Uniswap (the green area in the picture above) in terms of transaction volume and user volume.
PancakeSwap’s daily transaction volume has surpassed Uniswap many times. In addition, because PancakeSwap is backed by Binance and the BSC ecosystem and has a huge user base, the number of daily active users of PancakeSwap is significantly higher than that of Uniswap, which is 7-8 times that of Uniswap. The fee advantage of BSC over Ethereum also makes users’ transaction frequency on PancakeSwap higher. As of writing, PancakeSwap has had more than 1.57 million transactions in 24 hours.
From the data point of view, another interesting platform is 1inch. The liquidity of assets on 1inch is significantly lower than that of other DEXs, but its transaction volume, user volume, and number of transactions are comparable to, or even higher than, other DEXs.
This may be related to the positioning of its DEX aggregator. Platforms such as 1inch and Matcha aggregate the liquidity of multiple DEXs to provide better swap prices and better user experience such as slippage. Perhaps for this reason, although the asset liquidity on 1inch is only 1/10 of SushiSwap and Curve, the number of users and transactions per day is several times that of SushiSwap and Curve.
Uniswap and PancakeSwap have obvious advantages in asset liquidity and transaction volume, but at the same time, there are more and more DEX innovators, such as 1inch that aggregates multiple DEX liquidity, Curve and support for precise positioning of stable currency trading niche markets. Unilateral market-making DODO, AMM ancestor Bancor, etc. are dividing up the DEX market and challenging the leading DEX.
Stable currency is the most mainstream trading asset of DEX, and DEX functions show a diversified development trend
Data source: DEX websites Statistics time: 2021/4/27
Comparing mainstream DEX and CEX, it can be found that the number of currencies supported by DEX is close to that of CEX, but the number of trading pairs supported by DEX is generally higher than that of CEX.
This may be related to the automatic market-making DEX of many mainstream DEX: users can provide liquidity to any asset, and as long as the trading pair has liquidity, the exchange ratio between assets can be determined according to the algorithm, instead of needing to have liquidity like CEX. A large number of technical support personnel and professional market-making team.
In addition, there is a clear difference between DEX and CEX in the currency with the highest trading volume. The assets on DEX are mainly trading pairs with stable currencies. On CEX, the currencies with the highest trading volume are mainstream currencies such as BTC and ETH.
This shows that most DEX users are still in the stage of using stablecoins for the “deposit and withdrawal” of DeFi assets or directly use stablecoins for DeFi operations. The exchange between DeFi assets with large price fluctuations has not yet reached the mainstream and prosperous level. .
It can also be seen from the dimension of “the currency with the highest transaction volume” that PancakeSwap is extremely dependent on Binance and the BSC ecosystem. Two of the three currencies with the highest trading volume are WBNB and BUSD, which are the native assets of Binance ecology, one is the encapsulated asset of BNB, and the other is the stable currency of Binance ecology.
Another obvious feature of trading assets on DEX is that the adoption of ETH far exceeds the currency king BTC. As an important infrastructure of DEX, the three stablecoins with the highest appearance rate are USDC, USDT, and DAI.
In terms of the richness of platform functions, liquidity mining has almost become the standard configuration of all DEXs, and this function has also spread to CEX. In addition, many DEX and CEX support token lending functions.
In the attempt and expansion of innovative functions, DEX is obviously better than CEX. For example, PancakeSwap has a lottery market and a collectibles market, and SushiSwap supports the aggregation of user-authorized funds for investment strategies voted by the community (such as flash loans). SushiSwap has shown a yearn ecological aggregation and revenue optimization. style.
Uniswap is the DEX with the highest gas consumption and the platform that most encourages users to make markets
Data source: Cryptofees.info Statistics time: 2021/4/28
Among the 5 DEXs surveyed, the gas fee/handling fee collection rules are divided into two types. One is the DEX platform native to the Ethereum network, where users need to pay gas fees according to the network congestion when doing transactions. A fixed percentage fee is charged based on the transaction amount. Currently, PancakeSwap and 1inch are charged at a rate of 0.25%.
It can be seen from the data that Uniswap is the DEX with the highest gas consumption, indicating that Uniswap is highly adopted, followed by PancakeSwap.
In addition, Uniswap is also the DEX that most encourages users to make market. Liquidity providers (LP) can get a 0.3% commission on Uniswap V2. This data is 0.17% and 0.25% on PancakeSwap and SushiSwap, respectively. After Uniswap is updated to the V3 version, its LP reward rules will also show a finer granularity, which will be divided into three levels, following the principle of higher rewards for users who bear higher LP risks.
In terms of the gas fee/handling fee gameplay, PancakeSwap introduced a part of the handling fee income to repurchase and destroy platform coins into DEX.
This effect may be immediate. At the same time as the V2 version was launched and implemented, PancakeSwap’s platform currency CAKE has risen by 24.13% in the past 7 days, and most DEXs are also largely due to paying gas fees in the form of ETH. Supported the price of ETH.
In addition, DEX is also actively exploring the possibility of reducing gas fees through layer2. Curve is already running on the layer2 network Polygon; Uniswap and SushiSwap have respectively stated that they will use Optimistic and zkSync as layer2 expansion solutions.
On the other hand, PancakeSwap relies on BSC’s high TPS to promptly take over the DeFi users and funds overflowing from Ethereum. However, it can be predicted that when the TPS of the Ethereum network is improved or the layer2 solution is verified and popularized, the gas fee advantage of PancakeSwap will also disappear.
PancakeSwap has a leading edge in social media popularity, website visits, search index and other dimensions
Data source: Coingecko, Google Trending Statistics time: 2021/4/28
As mentioned earlier, PancakeSwap has a huge user base, so it far surpasses other DEXs in terms of social media popularity (mainly reflected in the number of fans), website visits, and search index.
Among the above data, website visits and Google search index may have more reference significance. The number of website visits can better reflect the frequency with which DEX is used, while the Google search index can better reflect the popularity of DEX, that is, the degree of interest of users (including users outside the circle) in related DEX.
The Google search index in the past 3 months shows that Uniswap (blue line in the figure below) has maintained a high level of popularity among all DEXs. However, from the end of March to early April this year, PancakeSwap (red line) has shown a clear catch-up trend. PancakeSwap is far more popular than other DEX.
Source: Google Trending
In addition, domestic users’ attention to DEX can be said to be the highest. There are Chinese regions in the regions with the highest DEX search volume. Among them, the regions with the highest Google search indexes for Uniswap and SushiSwap are China.
Note: This article is not intended as investment advice. Beep News reminds users to pay attention to investment safety.