The total trading volume on the decentralized exchange platforms has increased by almost $800 million in the past two days. This has everything to do with the US Securities and Exchange Commission (SEC) indictment against Coinbase and Binance. The two stock market giants are facing a lawsuit against the regulator, which is causing investors to flee en masse to the DeFi world.
444 percent increase in DeFi
If you’ve been in the industry for a while, you’ve probably heard of a decentralized trading platform, also known as a DEX. In principle, these are alternatives to parties such as Binance and Coinbase, where you can trade on a blockchain based on smart contracts. This way you can trade without intermediaries and in principle there is no longer a centralized entity between the buyer and seller.
Uniswap V3 (Ethereum), Uniswap V3 (Arbitrum) and Pancakeswap V3 (BSC) are currently the three largest decentralized exchange platforms. Together they account for 53 percent of the total trading volume of all decentralized crypto exchanges. Between June 5 and June 7, the trading volume of these exchanges increased by $792 million or 444 percent.
Trading volume on Curve, a DEX on Ethereum (ETH) where it is possible to trade stablecoins, also increased by 328 percent. At the time of writing, the bulk of trading on Curve is focused on USD Coin (USDC) and Tether (USDT) trading.
The hype about memecoins
The trading volume on the decentralized exchanges also briefly surpassed that of Coinbase in May. That happened during the so-called hype om memecoins as pepe (PEPE) and turbo (TURBO) which at that time went completely through the roof via Uniswap and some other decentralized protocols. Even today, memecoins like pepe are popular again.
That was mainly due to the fact that these memecoins cannot be found at centralized exchanges. In order to buy them, people therefore have to find their way to these kinds of decentralized trading platforms.
Netflow to Binance over the past 24 hours is $778.6M negative on Ethereum – $871.7M in and $1.65B out
Over the past hour, netflow on Ethereum continues to be negative at $35.7M on Ethereum – $14.8M in and $50.5M out
Track it here https://t.co/nwTgpXWhZY and filter for “Binance” pic.twitter.com/jnNAN0QKVy
— Nansen 🧭 (@nansen_ai) June 6, 2023
While trading volumes at the decentralized exchange platforms are going through the roof, we see an opposite trend happening at Binance. Binance had a net outflow of $778.6 million in ethereum yesterday. The trading platform saw $ 871.7 million in inflows and had to offset an outflow of $ 1.65 billion. That goes along with this news.