Uniswap hits $500 billion mark in volume, but loses space in the DeFi market

Decentralized exchange (DEX) Uniswap hit an important milestone over the weekend. Total DEX volume topped $500 billion for the first time. The figure corresponds to R$ 2.8 trillion at the current price. erc20 token creator According to Uniswap’s own data, the value was achieved over almost two years. The platform was created in November 2018, but the volume began to emerge only from May 2020.

In fact, it took Uniswap 15 months to reach $100 billion in volume, but it took half that time to go from $100 billion to $500 billion.

The Uniswap team thanked users for their trust in the platform and celebrated the new record. Simultaneously, DEX pointed out that the launch of the Arbitrum and Optimism platforms, which improve the scalability of Ethereum (ETH), contributed to the figure.

"We are proud of the magnitude of this number, but we are even more pleased to know that millions of users had direct access to markets they could trust to operate in their best interests. Of that volume, $2 billion was contributed by Arbitrum and OptimismPBC deployments, which are starting to gain significant traction," DEX said.

The greater the scalability of Ethereum, the greater the possibility that Uniswap will continue to register volume. After all, one of the disadvantages of DEX is precisely the high fees charged on the blockchain, which end up making small transactions unfeasible.

dYdX outperforms in volume

As Uniswap breaks records, it continues to lose share in other markets. For example, DEX’s daily volume was once the largest in the decentralized finance (DeFi) market. But now, with increased competition, it only occupies 3rd place.

Taking into account only the v3 protocol, Uniswap’s volume in the last 24 hours was $1.085 billion, or 9.71% of the total. Adding the v2 and v3 protocols together, the figure rises to US$ 1.56 billion, which corresponds to 13.9% of the total volume.

Despite being high, both values??are very far from DEX dYdX. It is the current market leader, with $4.5 billion in volume. At the time of writing, dYdX accounts for 40.5% of all DeFi volume. Data is from CoinMarketCap.

What Influences the Uniswap Price?

There are a number of elements that influence the price of Uniswap tokens and these start with general market conditions. But there are also many specific factors to consider. The initial presale coin offers volumes and the mining process will have an impact on the final price of the cryptocurrency, along with its price direction mechanisms. At the origin of the currency, one billion UNI were minted, which will be accessible in the next four years. Once this 4-year period is over, a perpetual annual inflation rate of 2% will apply.

Uniswap is an automated liquidity protocol, which means smart contracts are used to define liquidity pools and exchange tokens. Prices are determined by the number of tokens in each pool, and the smart contract maintains a constant through the x*y=k function (x = token0, y = token1, k = constant). Each time an operation is performed, tokens are withdrawn from the pool in an amount corresponding to the other token. erc20 token generator The balances held by the smart contract are adjusted during the execution of the operation, which in turn affects the price.

Recent cryptocurrency price developments and market capitalization will also play a role, and the general direction of the cryptocurrency market will also be reflected in the price of Uniswap. The demand for tokens can cause the price of Uniswap and other cryptocurrencies to rise, as can the growing popularity of cryptocurrencies as a means of payment and investment. It is important to note that with Uniswap, and the cryptocurrency niche in general, its price and market cap volatility can be greater than that of commodities and stocks. This often leads cryptocurrency traders to hedge their investments.

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