The number of large decentralized exchanges (DEX) is growing amid an overall decline in the number of centralized cryptocurrency exchanges.
According to the data
Chainalysis report, the volume of assets on large decentralized exchanges like Uniswap and SushiSwap has grown fivefold from 2020, and DeFi trading volume on them jumped 550% in 2021. The rise of decentralized exchanges has coincided with the explosive growth of the DeFi market. In November, DeFi trading volume reached $ 274 billion and most of the assets are locked in Ethereum-based DEXs such as Curve and Uniswap.
Also noteworthy is the growth of derivatives exchanges, which are still small compared to other categories. In August, there were 265,000 transactions on derivatives exchanges, which is less than 5 million transactions made on DEX in the same month. But the average derivatives trade was $ 79,000, compared to $ 26,500 on the DEX.
Since the average transactions on the derivatives exchanges were larger, their growth in 2021 was higher than that of the DEX. As a result, major derivatives exchanges such as Deribit, Bitmex and FTX soared 686% in terms of trading volume.
The DEX’s rise comes amid a steady decline in centralized cryptocurrency exchanges. In July 2020, after growing since January 2019, the number of active cryptocurrency exchanges began to decline. The head of research at Chainalysis, Kim Gauer, said that within 12 months the number of trading platforms dropped from 845 to 672. In his opinion, the reason is the consolidation of platforms and the withdrawal of small exchanges from the market due to lack of liquidity.
After the expansion of the ban on cryptocurrencies in China, the price of DEX tokens has grown significantly, and trading volumes in some DeFi protocols have exceeded the volumes of large centralized exchanges. According to DappRadar, the total value of cryptoassets blocked in DeFi apps has grown by 936% over the year. At the same time, at the beginning of the month, TokenInsight analysts reported that in the third quarter the trading volume on DEX in Ethereum decreased by 23%.
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