The larger DeFi category has brought in several winners of the cryptocurrency market in the past year, but few have become as dominant as Uniswap.
Not only has the related UNI token itself performed incredibly well, Uniswap’s dominance has resulted in DEX volume growing more than 1,000 times from this point last year to now. What’s behind this explosive trend, and when – or ever – will it end?
DEX trading volume has grown more than 1000x in the past year
The “DeFi Summer” of 2020 put the category on the map and gave birth the next wave of altcoin all-stars. At the end of the ultra-hot trend, Uniswap debuted its UNI token, which has since risen 700% from its low in November.
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The demand for the token is skyrocketing, indicating that magic is happening on the platform itself, and investors know it.
Uniswap dominates all other DEX platforms, driving the 1100% increase | Source: Dune Analytics
Not only has Uniswap experienced rising trading volume as a result, but its total decentralized exchange (DEX) volumes have increased more than 1,100 times from a year ago, from $ 39.5 million to $ 43.5 billion, according to the most recent monthly report from Arcane Research.
All major platforms have exploded with rising interest in the crypto market, but few have dominated like Uniswap. Of the decentralized exchange volume breakdown in January, Uniswap represents 46% of the total volume, or nearly $ 20 billion.
The platform represents nearly half of all DEX volume | Source: Arcane Research
Decentralized exchanges such as Uniswap, allow investors to quickly and easily trade one token for another, all through a private Ethereum wallet.
The rise and dominance of DeFi Platform Uniswap
Exchanges of this nature have been around for some time, but Uniswap’s unique version, the Unicorn logo and vibrant colors provided the allure that attracted investors to actually start using them.
Uniswap’s branding power and the fact that it is thriving as a platform has resulted in its own UNI token being in similar demand. The shopping frenzy has increased the token to $ 13, from less than $ 1 per token.
Uniswap is up over 700% from the November low | Source: UNIUSDT on TradingView.com
A large part of the UNI tokens were initially given away for free. At the time, valued at around $ 3 per token, the 400 were essentially free UNI the form of a stimulus check of the cryptocurrency market.
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However, what boosted it was the platform and token lifespan, confirming it as a major competitor in the DeFi room. The 1100x annual growth of the decentralized exchange volume is testament to its impact, and it’s just the beginning for the young, burgeoning brand.
Featured image from Deposit Photos, Charts from TradingView.com