Odaily Frontline｜Ethereum DEX competes for market share, is CEX panicking?

This article comes fromU.Today, by Joseph Young

Odaily Translator |

Odaily Translator |

Decentralized exchanges (DEXs) on Ethereum are dominating the market. The fees people pay to deposit ETH to exchanges have fallen, while DEXs like Uniswap continue to see increased trading volume.

Due to the cost of Gas, researchers can measure the decrease in Ethereum user activity on centralized exchanges.

On the Ethereum blockchain network, when users send transactions, they need to pay transaction fees in the form of Gas. If the ETH fees associated with centralized exchanges drop significantly, it may indicate an overall decrease in activity by Ethereum users on centralized exchanges.Glassnode analysts found

, the proportion of Ethereum fees used for centralized exchange deposits has dropped from 25% three years ago to 1%. They said, “One graph shows the change from CeFi to DeFi. The proportion of ETH deposit fees paid to centralized exchanges on Ethereum has dropped from about 25% in 2017 to less than 1% today. The past few months Here, almost all transaction fees involving centralized exchanges are used for ETH withdrawals.”

One of the main reasons why major DEXs have been able to outpace some of the large centralized exchanges in volume is availability and liquidity.

Over the past two years, decentralized exchanges have not been attractive enough for users to rely on them. At that time, the DeFi cycle did not develop to the current scale, and people did not have enough interest in emerging DeFi projects.

For example, as of Dec. 12, Uniswap had $1.6 billion in liquidity and $246 million in daily trading volume.

secondary title

Are Centralized Exchanges So Steering People To Bitcoin?

Some Ethereum users have speculated that centralized exchanges may be trying to steer people toward Bitcoin as ETH and DeFi users flock to decentralized exchanges.Uniswap founder Hayden Adams admits this

, and said it was a logical conjecture. He said, "This is a good point. Ethereum/ERC20 is mainly used in decentralized platforms (DApps), Uniswap is surpassing centralized exchanges (CEX). Bitcoin does not have smart contracts, so it is mainly used in centralized platforms. use, and for functions other than payment."

According to Crypto Fees data, Uniswap processes over $880,000 in Ethereum network fees per day. That's only $400,000 away from the Bitcoin network's roughly $1.285 million per day in fees.In addition to this, the broader DEX market is gaining a larger share of the global cryptocurrency trading market every day.CoinGecko CEO Bobby Ong noted