According to data from Dapp Total, the total value of 36 DeFi application lock positions that have been counted so far is 1.2 billion US dollars, a decrease of 7.44% year-on-year, of which 3.7 million ETH lock positions, accounting for 3.37% of the total ETH supply; EOS locks The warehouse volume was 72.19 million, accounting for 7.1% of EOS's total supply. The three items with the highest proportion of locked-up value distribution are: Maker, EOS REX, and Edgeware, accounting for 36.13%, 17.85%, and 12.29%, respectively.
The DeFi lock-up amount has declined due to the plummeting of the currency price. However, DEX, an important part of the DeFi ecosystem, has experienced a substantial increase in the recent past. What is the reason?
The problem of centralized exchanges is frequent, so is the demand for DEX by users increasing?
Power is easy to inflate, and once it is out of control, it will cause disaster.
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The recent explosion of the Fcoin exchange, and the use of user assets of the exchange Binance to participate in Steem voting are examples of this.
Obviously, the occurrence of such events reminds digital asset holders about the risks of a centralized platform. Do they promote people to adopt a decentralized DEX platform?
Let's look at the specific data.
Let's start with Binance DEX under Binance. According to Binance's latest report, in February, Binance DEX's performance was not active. It only launched a new trading pair: ETH / BUSD. As of now, there are 123 digital asset trading pairs on Binance DEX.
As shown in the figure, the daily trading volume of Binance DEX in February is still very low, with a median of about $ 1 million. The platform has not experienced growth since its launch and the trading volume has been on the decline.
As a centralized exchange with a leading trading volume, Binance has huge flow advantages. However, the performance of its DEX products is not ideal, which is worth pondering.
On the Ethereum public chain, the DEX platform with the largest current transaction volume is Uniswap that does not issue tokens. According to statistics from dapptotal, Uniswap has shown an overall growth trend since the beginning of 2019. Specifically, we look at the data:
Let's look at another recently popular DEX platform, KyberNetwork:
According to data provided by qkl123.com, the market value of its token KNC at the beginning of the year was only 32 million US dollars. After three months of development, its market value has now reached 128 million US dollars, a growth rate of 400%.
In terms of platform transaction data, KyberNetwork's current daily active users are only 1270, 24-hour transactions are 23830 ETH, and the number of transactions is 4,970, which is slightly inferior to Uniswap.
The overall data of Ethereum DEX in dapptotal statistics are as follows:
Obviously, the growth of Ethereum's DEX platform since the beginning of this year is very obvious. The overall transaction volume has increased by nearly 4 times, while the number of transactions and the number of daily active users have experienced substantial growth.
This has a lot to do with the increasing popularity of DeFi. In addition, from the point of time, after the explosion of Fcoin, the transaction volume of DEX and the number of active users have increased significantly, and the recent Binance event, It also played a similar role.
Nevertheless, from the existing data, DEX is still a very niche field, which has a greater relationship with poor user experience. At present, most Ethereum DEX platforms are limited by the performance limitations of the Ethereum mainnet. (Only 10-15 transactions can be processed per second), and the cost of related transactions is very high.
Can Rollup technology stimulate DEX growth?
In order to solve the problem of performance and cost, some DEX platforms are exploring the use of technical solutions such as Optimistic Rollup & zkSTARKs Rollup . Examples include Uniswap, IDEX, Loopring, 0x and so on.
In simple terms, the zk-Rollup scheme is to package a large number of transactions and publish it on the chain together with a SNARK zero-knowledge certificate. This type of scheme has better security, but is relatively poor in generality and can only be used for specialized operations in the short term ( (Such as token transfers or atomic swaps).
The Optimistic Rollup scheme is a kind of compromise. Because it uses a method called "proof of fraud" to verify the validity of the transaction, it does not need to provide proof for each state transition, and only when someone thinks that the state transition has It is provided by mistake. In terms of versatility, Optimistic Rollup is better than ZK Rollup, but it sacrifices security.
Theoretically, after using the zk-Rollup and Optimistic Rollup schemes, the current Ethereum DEX can carry up to 2000 transactions per second.
What about reality?
We can see Loopring, the first ZK Rollup DEX project mentioned by Vitalik many times recently. Currently, the platform can actually carry about 100 transactions per second, and the gap between it and the theoretical maximum is mainly due to relays. System limitations. After optimizing the zkSNARK proof, the settlement cost and proof cost of Loopring DEX can be optimized to be negligible.
Can technology advantages bring good results? Let's look at the transaction data. As of now, the daily transaction volume of the Loopring DEX platform is about 1100 ETH (about 230,000 US dollars), and in terms of the number of transactions, in the past day, a total of 5850 transactions occurred on the platform (belonging to the initial Small test transactions), obviously a breakthrough in performance did not immediately bring a lot of user demand for DEX.
From the initial experience of individuals, the upgrade of the zk-Rollup technology solution has gradually brought the user experience of DEX closer to the centralized exchange. However, the user's demand for DEX is still in a very early stage, which mainly flows with DEX. Poor sex and their high threshold for use have a lot to do.In addition, these DEXs generally only support the exchange of Ethereum's native assets, while other blockchain assets such as BTC need to be anchored in currency. get on.
In addition, DEX may also face problems such as pre-transactions and transaction re-ordering. For details, please see this article, " DEX and CEX will eventually have a battle. Solving these problems will be the key ."
DEX has a long way to go in the future!
Pan Chao: Automated Market Maker DEX Economics
In the above, we mentioned that the number one DEX in the current Ethereum ecosystem is Uniswap without an issued token. So what are the characteristics or excellence of this DEX?
Pan Chao, head of MakerDAO China, mentioned in his new article " Automated Market Maker DEX Economics ": "
Uniswap and other automated market-making agreements fundamentally do what they do, using this mirror of liquidity pool inventory to simulate price changes.
Everyone can join the liquidity pool, as long as the specified two assets are deposited, the system uses the "constant product" model to obtain the asset price. The "constant product" model sounds complicated, the actual principle is simple, and it is the same as the behavior of individual market makers described above-under the condition that the total capital is constant, the balance of the inventory on both sides is guaranteed. If an imbalance occurs, adjust the price. The difference is that the market maker adjusts the price change range according to its own judgment, while the automated market maker model is based on a fixed ratio. …
Uniswap is like a special vending machine. As long as someone buys the product, the price of the product will increase, and the more you take, the faster the price will rise until the market maker and arbitrage replenish.
In real life, we not only need vending machines to meet temporary needs, but also rely on large supermarkets to meet the daily needs of the general public. In the world of cryptocurrencies, automated market making DEX is an interesting part of DeFi Lego, but it cannot become the mainstream.
Defi Attack: Open Finance for Open Finance
In addition to improving the user experience, what are the other ways to promote DEX or DeFi?
In this regard, X-Order mentioned in the newly published article " Out of Circle Achieves Open Finance ":
"A lot of opinions previously believed that DEFI lacked enough users because the financial system is not yet perfect. No matter the speed or experience, it is not as good as the traditional financial system. So as long as we continue to iteratively improve and speed up Going up, getting a good sense of experience will attract more users.
But in fact, just as the tenfold good theory mentioned in Peter Tier's "From Zero to One", if it is to achieve the same function and goal, it must be ten times better than the opponent (traditional financial system). DEFI is obviously an unattainable standard. It takes some time to equalize, let alone ten times better. …
Therefore, what is more important now is not to optimize a local function, but to find a key breakthrough that can bring more user traffic-out of the circle.
" So how can we get out of the circle, the article mentioned:
- Start from the blind spots of the traditional financial system;
- Enter from the payment field;
- Strengths and avoid weaknesses (combined superposition effect);
DeFi project progress in one week
- Kyber Network and Bancor Network perform network integration to provide cross-chain liquidity for Defi;
- Fantom launches Defi platform;
- Argent, a smart wallet, received $ 12 million in Series A funding;
- 0x update staking, liquidity API and off-chain orders;