In November, 29 billion dollars were traded

The recent surge in cryptocurrency markets over the past month seems to have spilled over into the realm of decentralized finance (DeFi).

Decentralized exchanges (DEX) have significantly lower transaction volumes than centralized exchanges (CEX). However, the recent market rally has led to increased activity, albeit somewhat slower.

DEX trading size chooses speed

According to research from Caico, major platforms such as Uniswap and Curve on the Ethereum blockchain, as well as Pancakeswap on the Binance Smart Chain, have seen an increase in activity.

Monthly trading volume on DEXs rose to $29 billion in November, recovering from a multi-year low in September. Despite this improvement, it is still significantly lower than the peak of more than $124 billion recorded in May 2021. The DEX's trading volume compared to CEX's decreased last year, falling to only 3% in November. It decreased from 5% in January.

Notably, in November 2020, during the height of DeFi excitement, DEXs achieved an all-time high market share of 10 percent. This suggests that DEXs were more affected by the low market participation seen after the FTX crash.

While the largest DEX, Uniswap, has lost its market share compared to Coinbase, it still holds a significant position of 40%.

The increase in DEX activity is also reflected in higher lending rates. An increase in lending rates, especially for stable coins, often reflects an increase in the number of loans taken out for business purposes.

DEX trading volume up to Q3

Signs of recovery observed in the latter part of Q1 faded as trading volumes did not continue the upward trend in Q2. Pressure from regulators has particularly affected centralized cryptocurrency exchanges, making them the primary losers.

However, the resulting turbulent market conditions also affected decentralized exchanges. In Q2, spot trading volume on the top 10 decentralized exchanges (DEX) reached $155 billion, down more than 30% from Q1.

The total spot transaction volume on the top 10 decentralized exchanges reached $105 billion in Q3 2023, a decrease of -31.2% compared to the previous quarter.

During the third quarter, CoinGecko THORchain showed the highest growth, the volume increased by 113%, equal to $1.27 billion. However, this increase in volume may be due in part to illegal transfers on the network, which include prominent users such as the FTX hacker and North Korea's Lazarus group.

Conversely, Sushi, which has been on the DEXs since its inception in 2020, dropped out of the top 10 at the time and was replaced by Orca.