Bullish outlook: How DeFi and decentralized exchanges could continue to grow
Decentralized Finance (DeFi) has seen parabolic growth since early 2020, with the total value set in these largely Ethereum- based contracts rising from $ 1 billion to now $ 12 billion.
Decentralized stock exchanges (dexs) were decisive for this growth
In 2017 and 2018, many thought these apps were clunky due to the high transaction fees and the very slow and confusing user experience.
However, with the introduction of Bitcoin Profit and other decentralized exchanges, things began to change. At several points over the past summer, the volume and liquidity of the decentralized exchanges exceeded the volume and liquidity of top exchanges like Coinbase.
But this growth may not stop there. Top analysts in the industry assume that the Ethereum -Dexe will rise even further in the coming weeks and years.
This is likely to lead to a rally across the DeFi area and likely at ETH itself, which will benefit from this influx of interest in decentralized settlement.
According to analysts, decentralized stock exchanges will grow even faster
Crypto asset analyst Qiao Wang believes two fundamental trends will get the decentralized exchanges going in the coming months and year.
Initially, after months and years of development, the Ethereum solutions of layers 1 and 2 are used. It is believed that Optimistic Ethereum will be introduced, which will enable DeFi transactions on a more private, cheaper and more powerful second layer.
Other companies like Starkware and Matter Labs are also working on promising scaling solutions that should lead to a better user experience.
Second reason Dexs might take off: There have been a number of issues with centralized exchanges lately.
Bithumb was searched. KuCoin has been hacked. Recently, BitMEX was charged with derivatives and money laundering violations by the US CFTC, while OKEx suddenly stopped withdrawals because a private key holder of the organization went offline.
“It can hardly be stressed enough how important it is that 1) Ethereum L2s and scalable L1s go online and 2) what has happened to Kucoin / Bitmex / Okex in the last 2 weeks. The timing couldn’t be better so that the decentralized futures / swap exchanges finally take off in 2021. „
Uniswap could take the lead in this new era of Dexs with the introduction of the third iteration of the protocol, „v3“.
It is expected that the team behind the protocol will bring out a revamped exchange that will greatly improve the usability. The company recently announced that it would have a $ 11 million Series A round in August under the direction of Andreessen Horowitz with additional investments from USV, Paradigm, Version One, Variant, Parafi Capital, SV Angel and A.Capital “Performed for this upgrade.