According to the insightful H1 market report, the bear season has brought about some noteworthy effects on Decentralized Exchanges (DEX). Not surprisingly, the trading volume across DEXs has witnessed a steady decline over the course of the quarters in H1.
According to the round-off report for the first half of the year by Coinmarketcap, the highest trading volume occurred in March among the top 15 DEXs. Although this volume remained consistent in Q2, it actually decreased by 24% compared to Q1. Q1 recorded a total of $249 billion, while Q2 saw $189 billion.
Among the DEXs, the top three were Uniswap, Pancakeswap, and Curve-Finance. Uniswap, being the most dominant decentralized exchange, held a significant market share of 57.5%. Notably, Uniswap’s monthly volume matched the spot volume of the prominent centralized exchange Coinbase.
Uniswap revolutionized the market with automated market makers (AMMs) on Ethereum. PancakeSwap focuses on the Binance Smart Chain with lower fees and efficient trading. Curve Finance specializes in stablecoin trading, prioritizing stability and liquidity. These exchanges cater to different DeFi needs.
In H1 2023, Uniswap, PancakeSwap, and Curve Finance dominated the market, accounting for approximately 82% of the total market share. PancakeSwap held 12.7%, while Curve Finance held 11.5%.
While CEXs has faced numerous regulatory compliance challenges, causing waves of fear, uncertainty, and doubt in the market, it remains more popular than DEX solutions.
Interestingly, according to the CMC report, the DEX to CEX ratio has increased to around 1:8. This can be attributed to various factors, such as advancements in DEX products and market concerns. The concerns surrounding CEX are primarily linked to regulatory developments. Other contributing factors to this ratio include a more favorable environment, lower gas fees, and a higher proportion of crypto-native participants.
In the first half of 2023, nearly 80% of the DEX trade volume originated from Ethereum and its Layer2 chains. However, BNB is quickly catching up and gaining a larger share of the DEX trading market in the second quarter.
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