Volume up

Decentralized Exchange Volumes To Reach All-time high

Decentralized exchange (DEX) volumes are surging to reach all-time highs, as another booming sector in the crypto space amid Bitcoin (BTC)’s surge. 

Starting 2021 off with a bang, transaction volume on DEXs in January are set to break September 2020’s record highs. According to The Block’s report on January 16, DEXs record $26.01 billion volumes in this month so far, capturing the second-highest monthly volume on record. 

The previous record high was $26.6 billion in September 2020, fueled by the boom of decentralized finance (DeFi) in the summer. 

By deploying smart contracts on blockchain networks like Ethereum, decentralized exchanges enable users to swap between cryptocurrencies without transferring tokens to a centralized exchange wallet or verifying their identity. 

Decentralized exchanges like Uniswap, SushiSwap, 1inch, 0x, and others, exploded in popularity throughout 2020. 

SushiSwap Gaining Market Share

According to crypto data provider Dune Analytics, DEXs have already transferred over $27 billion in transaction volume as of January 15, trailing the all-time high of $29 billion in September 2020. 

 At the current rate, decentralized exchanges are on track to process over $55 billion in transaction volumes in January, close to half of all the volume transacted in 2020. 
Breaking down the transaction volume, Uniswap is still the most popular DEX – as it has been since March 2020 – accounting for 45% of the total transaction volume, followed by SushiSwap with 22% share. The other top 5 spots went to Curve (12%), 0x (8%) and Balancer (2%), according to The Block’s data. 

However, one of the biggest issues confronting DEX users continues to be the fees associated with Ethereum-based DEXs. In many cases, users have had to eat the associated on-chain trading fee, despite that the swap ultimately fails.