Analysts have seen a surge in DeFi token trading
Date: 2023-08-03 Author: Karina Ziganova Categories: BLOCKCHAIN
Interest in decentralized finance (DeFi) tokens has skyrocketed after the US Securities and Exchange Commission (SEC) labeled some of them as securities, according to a review by Glassnode.
Between June 12 and July 24, the DeFi price index rose by 56%. According to analysts, this trend is also associated with the victory of Ripple (XRP) over the SEC. This shifted the dominance of Bitcoin (SEC) and sparked interest in DeFi tokens.
“DeFi-linked tokens performed the best, with the DeFi index price up 56% from the June 11 low. Other key market sectors such as GameFi and Staking performed poorly in comparison,” the report says.
Altcoins led by MakerDAO (MKR) and Compound Finance (COMP) have become the main interest of DeFi investors. For MKR, the implementation of the smart token burn mechanism has been the catalyst it needs to grow. COMP grew by 83% due to the launch of the Superstate project.
DEX Volumes
In addition to the success of MKR and COMP, capital inflows to decentralized exchanges (DEX) have also increased. DEX dominance rose from 3.75% to 29.25% between early June and late July. This may be due to trading activity on Uniswap (UNI), as well as the invasion of Sandwich bots.
“We see Sandwich bots typically making up over 60% of daily volume. The volume share of arbitrage bots has decreased from about 20% to 10% since the beginning of the year. Meanwhile, the proportion of volume created by human traders has increased to 30% since early July, in line with a period of heightened interest in DeFi tokens.
CEX anti-records
In May, trading volume on the largest centralized exchanges (CEX) fell to its lowest level in four years. Cryptocurrency exchange Binance was particularly hard hit, losing some of its market share.
Experts are predicting a further decline in trading volume as markets reached overheating in the first quarter of 2023. The situation with the volume of trading probably will not recover until the market stabilizes, analysts believe.
