In Ethereum's blossoming DeFi sector, TVL, which stands for Total Value Locked and equates to the assets managed within protocols, serves as a pivotal measure of success.
At the start of 2020, MakerDAO, known for its lending system and the Dai stablecoin, was the unchallenged leader in TVL. However, we've witnessed MakerDAO being overtaken, with platforms like Compound and Aave rising sharply to DeFi's upper echelons.
This brings us to Uniswap , the Ethereum Beloved by the community, Uniswap is the decentralized trading platform that, for the first time, has claimed the top spot. DeFi This week, it achieved an impressive TVL of over $1.75 billion USD.
Rapidly climbing in stature, Uniswap has, without a doubt, emerged as one of Ethereum's shining stars in the realm of early projects, and it appears this unrestricted trading platform is just beginning to gather steam.
Uniswap on Top
On Thursday, August 3rd, Uniswap's TVL surged past $1.77 billion, capitalizing on its position among the most dynamic projects in the DeFi landscape over recent months.
This surge positioned Uniswap prominently at the summit of the DeFi space for the first time, and here's how the current top 10 stands according to a leading analytics platform. DeFi Pulse :
- Uniswap ($1.77 billion TVL)
- Maker ($1.55 billion TVL)
- Aave ($1.47 billion TVL0
- Curve Finance ($1.17 billion TVL)
- yEarn ($906 million TVL)
- Synthetix ($862 million TVL)
- Compound ($705 million TVL)
- Balancer ($688 million TVL)
- WBTC ($448 million TVL)
- RenVM ($238 million TVL)
The DeFi ecosystem has been sizzling with unprecedented interest and activity recently, chiefly driven by the rise of popular yield farming strategies.
Notably, a significant aspect of Uniswap's rapid ascent is linked to the launch of SushiSwap, a fork of Uniswap with the added twist of $SUSHI token mechanics, which incentivizes Uniswap's liquidity providers and attempts to lure them over.
Consequently, the numerous yield farming opportunities have spurred massive user engagement, prompting many traders to use Uniswap as a gateway to participate in SushiSwap's reward pools.
This analysis touches merely on the short-term developments. Viewing the larger picture, over the past couple of years, Uniswap has established itself as a formidable force within DeFi, and its meteoric rise in recent months seemed inevitable.
An Unstoppable DEX
2020 has unquestionably marked a banner year for Uniswap. For instance:
- The protocol’s volume boomed 225% in Q1 2020 compared to Q4 2019.
- In April, the cryptocurrency exchange powerhouse, Coinbase, allocated part of a 1.1 million USDC fund into a Uniswap liquidity pool through its USDC Bootstrap Fund.
- In May, the team behind the project released Uniswap V2, a significant upgrade that has further accelerated DeFi's progress beyond mere expectations.
- Offering a new spin on the ICO craze from 2017, Uniswap has facilitated the launch of 'Initial DeFi Offerings' this year, with the UMA Protocol debuting its $UMA governance token.
- During the summer, Uniswap distinguished itself by listing more tokens than any other competitor in the top 10 decentralized exchanges.
- In June, the Uniswap team successfully secured $11 million in Series A funding.
- The DEX added nearly 60,000 users in July.
- Growing enthusiasm for the project culminated in the unveiling of UNISWAP-PERP, a perpetual futures contract launched by the crypto exchange FTX which monitors the top 10 liquidity pools on Uniswap.
- Lastly, between August 29th and August 30th, Uniswap achieved a record-breaking $426 million in 24-hour trading volume. For a sense of perspective, Coinbase managed only $348 million in the same timeframe. It's the first occasion where Uniswap has surpassed Coinbase in daily volume, but it likely won't be the last time this open protocol outperforms established centralized exchanges such as Coinbase.
The bottom line? Uniswap is experiencing a breakout year and appears well on its way to becoming a household name.
