DeFi
FTX, the second-largest CeFi in the industry after Finance, recently announced bankruptcy. FTX’s failure is not the failure of crypto. It just reflects the fragility of the centralized financial system. This might remind you of something- Don’t trust. Verify. This is the reason why we build DeFi.
Current status of DEXs
Can DEX replace the functions of CEX at this stage?
The answer is that it is absolutely possible. From transactions to pledge interest generation to legal currency deposits and withdrawals, there are corresponding DEXs or protocols to provide functions. There are Moonpay, Transak, and Wyre in terms of fiat currency deposits and withdrawals, and many DEXs have access to their services; there are a large number of protocols based on DEXs that provide pledge interest-earning services, and there are many DEXs that come with pledge interest-earning services.
From the perspective of product functions, mainstream DEXs such as Uniswap, Pancake, DODO, etc. all support the chart function. 1inch, 0x Protocol, DODO, Tokenlon, Paraswap, etc. have launched the limit order function, which is similar to the pending order of CEX, and users can pre-set the transaction price. The gap between DEX and CEX in terms of product functions is already very small.
DEX currently has certain user education issues, such as private key management and wallet interaction, and there are still certain differences between DEX and CEX in terms of user habits. However, DEX is undergoing rapid iteration and has become more and more mature.
Data
DEX occupies between 10% and 30% field of the total spot trading volume, and DEX is still catching up with CEX. Compared with 11.79% in October, it increased to 16.84% as of the 15th, which is somewhat related to the FTX’s Bankruptcy.
In the past 30 days, some mainstream DeFi protocols, the number of users and the number of on-chain transactions have all experienced double-digit growth. It can be seen that due to the impact of the FTX, DeFi applications experienced significant user growth. At the same time It also indirectly stimulates on-chain transactions.
As of 2PM UTC+8 on November 16, the 24h trading volume of Uniswap V3 surpassed OKX,ranking third in CEX, second only to Binance and Coinbase.
DeFi is the future?
Since the market entered a bear market, some people are using declining trading volume and TVL to prove that DeFi is dead. Has decentralized finance really failed? No, contrary to everyone’s perception, DeFi is running well. The declining transaction volume and TVL of DeFi are just like the falling market price of ETH. This is just a change in market conditions and does not affect the operation behind it.
Since the Luna incident, centralized financial entities, such as Celsius, 3AC, Voyager Digital, BlockFi, FTX, etc., have experienced crises one after another. They are no different from traditional financial companies, leveraged, lack transparency, and collapse in volatility, making their customers suffer heavy losses. And decentralized financial protocols, such as Uniswap, DODO, Curve, AAVE, Compound, MakerDAO, etc. are all working well.
Defi has the core value of Bitcoin and blockchain.
Don’t trust. Verify.
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