Ethereum Locked in Uniswap Soars to $1.6 Billion After UNI Launch

[kolbalish]

Uniswap, the largest decentralized exchange by volume, has seen locked value double in 48 hours after launching decentralized governance

The immensely popular Ethereum-based decentralized exchange, which has shown tremendous growth in trading volume in recent months, has seen a huge boost in the amount of money flowing onto its platform after just launching its own governance token, UNI.

Prior, up-and-coming decentralized finance protocols such as Aave and Curve Finance had unseated it from the top of the “total value locked” charts on DeFi Pulse, a metrics site that tracks the industry. Now, just 48 hours removed from the launch of UNI, Uniswap has nearly doubled the amount of Ethereum locked over the last day. That figure now stands at roughly $1.6 billion worth of ETH.

Total value locked (TVL) is a metric commonly used to compare the relative popularity of different DeFi protocols, with more value locked translating roughly into where attention from the DeFi community is focused at a given time. DeFi is a catch-all term used to describe an emerging set of decentralized applications built on blockchains such as Ethereum. DeFi lets users take loans using digital asset holdings as collateral and earn interest and other rewards by locking cryptocurrencies in smart contracts that facilitate trading between different tokens and other financial operations.


Just two days ago, TVL on Uniswap totaled less than $750 million. It’s more than doubled since then, much of the increase likely induced by the introduction of liquidity incentives, allowing users to receive UNI tokens in return for providing liquidity to designated pools on the decentralized exchange. The run-up back to the top of TVL charts is proof that while imitators like SushiSwap can clone protocols and offer reward schemes of their own, there’s little substitute for established brand recognition, first-mover advantage, and perhaps most importantly, a legion of loyal users.

A growing number of DeFi projects have released governance tokens over the last few months including crypto loan platform Compound and token swap and indexing protocol Balancer. Governance tokens are a key component of decentralized or distributed governance, where the community of users and supporters of a given blockchain-based application use the tokens to vote on the direction and decisions for the project, including adding new features or paying community grants to fund additional research and development.

Full article is here: https://decrypt.co/42339/ethereum-uniswap-soars-1-6-billion-uni-launch?amp=1

[tycsols]

Things are just getting started these figures will grow a very long way ahead because of this defi and yield farming trend. Also if staking eth on uniswap and other similar platforms yield more returns than eth pos staking then the eth locked in uniswap will soar and surge hundreds of times than they are now after eth 2.0 launch.

[disconnectme]

The reason is because people want to take advantage if the farming activities, I believe ones there is a price discovery some of these funds will  move to another protocol. The way things are in the space now, it seems we are close to playing Zero sum game. If new money don't enter the space in coming months, DEFI is likely going to correct heavily

[ololajulo]

Are those ethereum in custody of UNISWAP DEX?

[shakesbear]

Good profitability, so people have locked tokens, if in the future uniswap increases the number of pools where you can get Uni tokens as a reward, this should have a positive impact on both the token price and the amount of liquidity.

[nelson4lov]

I'm not surprised with the exponential growth that uniswap has enjoyed over the last couple of months. In the past, Decentralized exchanges have failed to live up to expectations until Uniswap came along with its unique offering like having users becoming liquidity providers and distributing fees as rewards. One thing I admire about uniswap is how they have ranked up and garnered enough volumes for themselves despite the stiff competition from centralized exchanges. Uniswap volume even surpassed that of coinbase sometime last week. Uniswap is spearheading the DeFi trend in crypto. There's still more to come.

Are those ethereum in custody of UNISWAP DEX?

I'm not quite sure. But as far as I know, users always have access to their locked tokens.  I think users lose custody when they start using pools from other protocols like balancer,  compound etc.