DEX increase volumes, CEX reduce

[Daltonik]

CoinGecko presented a report for the third quarter of 2020, according to which decentralized exchanges(DEX) show a steady increase in trading turnover, while centralized exchanges(CEX) show their decline. In September, the total volume of trading on the ten major DEX reached $30.4 billion, a month earlier it was $12.6 billion.



At the same time, it is worth considering that the total trade turnover of the top 10 CEX and DEX remained almost unchanged for the last two months and amounted to $327.2 billion in August and $330.6 billion in September.
According to CoinGecko: top 10 DEX : Uniswap, Sushiswap, Curve, 0x, Balancer, Kyber Network, Bancor, dYdX, Serum, Loopring
                                    top 10 CEX : Binance, Coinbase, Kraken, OKEx, Bitfinex, Bitstamp, Kucoin. Gate.io, Poloniex, Huobi Global.

For the third quarter, the average monthly increase in trading volumes on DEX was 197% , while CEX had 35%. In September, on centralized exchanges, the trading volume decreased by 5%. the largest drop was on Coinbase and OKEx, which was 60%



DEX trading volume rose 700% in the quarter from $3.8 billion in July to $30.4 billion in September.at the same time, 60% of the increase was provided by Uniswap



Uniswap and Curve dominate the total trading volume on DEX, accounting for 80% of the total trading volume, and Sushiswap is actively increasing trading volumes, which already account for 8% of the total trading volume on DEX.
The full CoinGecko report for the third quarter of 2020 which contains 32 pages can be found here: https://assets.coingecko.com/reports/2020-Q3-Report/CoinGecko-2020-Q3-Full-Report.pdf?utm_source=web&utm_campaign=report&utm_term=Q3-2020&utm_content=CG-users&0=

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[Oshosondy]

DeFi projects have been the main cause of increase in trading volumes on decentralized exchanges, Uniswap which is a decentralized exchange was even surprising, its trading volume really increased significantly and above what we thought could happen, uniswap trading volume now was reported to be more than that of coinbase. DeFi projects that are booming have really helped decentralized trading volume to increase. If DeFi will continue to rise, this will help decentralized exchanges trading volume to increase.

About centralized exchanges, people do use them because of trading flexibility, but with how they are not secure and safe, this could be part of what has reduced their trading volume because people are getting to know how unsecure they are and how they are often hacked, people are looking for more better means to make their funds safe.

[Yamifoud]

That is exactly how Defi projects manipulate the market. Many investors had come into DEX exchanges leaving CEX at the time which it won't surprise me but wondering what it happens now to these projects, most of them have done already, many of them are declining. Have to expect that DEX exchanges will dominate this time in the 4th quarter? Probably not, investors will still be looking for projects that are reliable and somehow most of them haven't found in DEX but not in CEX exchanges. Will be expecting that centralized exchanges will get the favor this time since Defi projects have already been over.

[GreatArkansas]

That is exactly how Defi projects manipulate the market. Many investors had come into DEX exchanges leaving CEX at the time which it won't surprise me but wondering what it happens now to these projects, most of them have done already, many of them are declining.
(....)

To be honest, I'm more favor using Decentralized Exchanges (DEX) than centralized exchanges, it does not matter about how will I make money just using Decentralized Exchanges, but it's the nature and effects of using Decentralized exchanages over centralized.
There are lot of positive effects using decentralized exchanges, just like your key, your wallet, which you are totally controlling your funds here, not some central authority just like centralized exchanges, while there are still some disadvantages of using decentralized exchanges.

[exstasie]

Currently, DEX volume stands at 6% of CEX.

Enough said. Nothing to get too excited about!

Defi hype was also huge in Q3. I'm really not sure that hype will sustain into next year. If it doesn't, we could see those DEX volume numbers dwindle back down a bit.

[Lycan70]

I really want to see the DEXes continue its rise after the DeFi hype. Using dexes is more convenient done the cex which includes signing up with kyc when you want to withdraw large amount. The dex platforms should improve and try to lower the transaction fees to be more competitive to Cex.

[pakhitheboss]

The increase in the volume of DEX is mainly because of the DeFi explosion as it is evident the top two DEX in this list are known for DeFi swaps. On the other hand, CEX are trying to cash on to this DeFi trend by adding many features on their platform but are failing to engage users because of the hacks and KYC regulation.

[Oshosondy]

Enough said. Nothing to get too excited about!

Defi hype was also huge in Q3. I'm really not sure that hype will sustain into next year. If it doesn't, we could see those DEX volume numbers dwindle back down a bit.

To be sincere, DeFi has been the cause of the increase in decentralized exchanges volume as I have commented earlier, but about DeFi being bubble and expecting it to still later worth nothing might not be so. Even the so called ICO and IEO which became a perfect means of scam in years back, there are still many of such coins existing today, that is why there are more than 7000 cryptocurrencies existing while more than 2000 cryptocurrencies has vanished, but still these altcoins that did not vanish add volume to the total cryptocurrencies that are existing. Also see DeFi projects like that, but DeFi projects have been ways many people have been scammed too, while many projects that rise in price can decrease even in the same day, making people to lose, many also led to losses of thousands to millions of dollars from investors due to one mistake or the other. I too can not invest on any DeFi project.

[Lycan70]

To be sincere, DeFi has been the cause of the increase in decentralized exchanges volume as I have commented earlier, but about DeFi being bubble and expecting it to still later worth nothing might not be so. Even the so called ICO and IEO which became a perfect means of scam in years back, there are still many of such coins existing today, that is why there are more than 7000 cryptocurrencies existing while more than 2000 cryptocurrencies has vanished, but still these altcoins that did not vanish add volume to the total cryptocurrencies that are existing. Also see DeFi projects like that, but DeFi projects have been ways many people have been scammed too, while many projects that rise in price can decrease even in the same day, making people to lose, many also led to losses of thousands to millions of dollars from investors due to one mistake or the other. I too can not invest on any DeFi project.

I just wondering if the DEXes will not survive without the Defi project as someone mentioned here. Can developers improve some features of DEX to accomodate the needs of the traders? Especially the fees, transaction fees are really unbelievable sometime for small tràders.

[irixo10]

Since the volume in DEX increases while it's counterpart decreases that means that people are giving more attention to decentralized exchanges more. Well, from the look of things, it is right to say that DeFi can be seen as the major contributor to the growth of DEX which also shows that people are now understanding the significance of Dex as well. Also, focusing on the information available, it is now confirmed again that recent Dex like Uniswap and Sushiswap are now leading the race, as well the attribution also goes to DeFi projects, but that might also bring up a question and that is, with Defi gradually losing its hype, will the volume in those exchanges drop?
Looking critically and from my own opinion, I think although the volume might be affected a little but owing to the fact the huge volume is there already, it will continue attracting other projects as well; because in the crypto space one of the things that draws users to any exchange is good volume.

[Cryptoababe]

Recently, Everything about DEX is trending and most project that base on DEX are trending. Including the scam projects. So, It's right for DEX to get more volume than CEX. Nothing else

[stompix]

Recently, Everything about DEX is trending and most project that base on DEX are trending. Including the scam projects. So, It's right for DEX to get more volume than CEX. Nothing else

Except for the fact that you somehow missed the fact that the top 10 CEX had 300 billion in volume while the top 10 DEX only 30 billion.

Centralized exchanges still have the bulk of trading volume, but obvious erosion of market share by DEXes have been observed. Currently, DEX volume stands at 6% of CEX.

Even the so called ICO and IEO which became a perfect means of scam in years back, there are still many of such coins existing today, that is why there are more than 7000 cryptocurrencies existing while more than 2000 cryptocurrencies has vanished, but still these altcoins that did not vanish add volume to the total cryptocurrencies that are existing.

And for the ones that did not vanish what has become of them?
Look at the first altcoin madness2015 table what's left of all those, even the top 2017 look like ancient history right now! Most of those coins survive just because people are clinging to them desperately for gains, they have no purpose whatsoever, they survive just because of the number of people trapped in it.

DeFi is hype, once people realize that the concept of making money out of thin air is really a utopia the end of it will appear on the horizon.

[XZERO1]

CoinGecko presented a report for the third quarter of 2020, according to which decentralized exchanges(DEX) show a steady increase in trading turnover, while centralized exchanges(CEX) show their decline. In September, the total volume of trading on the ten major DEX reached $30.4 billion, a month earlier it was $12.6 billion.

DEX trading volume rose 700% in the quarter from $3.8 billion in July to $30.4 billion in September.at the same time, 60% of the increase was provided by Uniswap

Nothing strange about that, ever since centralized exchanges started having all kinds of issues from freezing users funds for made up reasons, huge withdrawal fees and asking users for KYC literally anytime they want this was bound to happen, right now if you're not looking for problems and you're not willing to complete KYC process and the amount you're trading is quite large then the best way to do it is by using Uniswap and platforms like that.

The whole process of a swap on Uniswap is you just connect your wallet via metamask choose coins that you want to exchange with each other and with 1-2 clicks your transaction will be sent to the blockchain and you're done, the only problem with Uniswap and platforms using Ethereum network is Ethereum itself which can charge huge fees when the network traffic is high(which is not optimal for exchanging smaller amounts) but hopefully when Ethereum 2.0 comes out it can minimize transaction fees.

[stompix]

The whole process of a swap on Uniswap is you just connect your wallet via metamask choose coins that you want to exchange with each other and with 1-2 clicks your transaction will be sent to the blockchain and you're done, the only problem with Uniswap and platforms using Ethereum network is Ethereum itself which can charge huge fees

No, that's not the main problem.
The main problem is that other than toying around with shitty tokens you can't do much with uniswap, for you to get there you need in most cases a CEX as people usually have fiat and when they want out they again want fiat, not tokens, not stable coins and the so-called DEX mentioned in the research can't help you a bit with these things. Bottom line, if we consider DEX as in uniswap, not bisq , then one thing is clear, CEX can survive one their own, DEX...nope!

you're not willing to complete KYC process and the amount you're trading is quite large then the best way to do it is by using Uniswap and platforms like that.

And what are you going to do with those coins in the end?  Are you going to hold onto them forever or are you going to exchange them to eth or usdt and run to kraken and convert them to fiat? 

[XZERO1]

No, that's not the main problem.
The main problem is that other than toying around with shitty tokens you can't do much with uniswap, for you to get there you need in most cases a CEX as people usually have fiat and when they want out they again want fiat, not tokens, not stable coins and the so-called DEX mentioned in the research can't help you a bit with these things. Bottom line, if we consider DEX as in uniswap, not bisq , then one thing is clear, CEX can survive one their own, DEX...nope!

And what are you going to do with those coins in the end?  Are you going to hold onto them forever or are you going to exchange them to eth or usdt and run to kraken and convert them to fiat?  

So you just prefer to run around all different exchanges and do KYC verification for every single one of them just because you are forced to sign up for one centralized exchange with mandatory KYC process at the end to cash out anyway?

I don't know about you but I prefer to do KYC once on one single exchange and only when I want to cash out instead of having to do KYC every time I want to buy some random shitcoin on some exchange specially knowing many of them will sell your KYC information for some extra money, and we're talking about traders here otherwise if you are a long-term investor or you just trade BTC,ETH and some other high market cap coins one centralized exchange will work just as fine, but if your point is we can not have a completely decentralized experience while we are trading I agree with that and as long as Fiat exists that is not possible.

[Ucy]

DeFi projects have been the main cause of increase in trading volumes on decentralized exchanges, Uniswap which is a decentralized exchange was even surprising, its trading volume really increased significantly and above what we thought could happen, uniswap trading volume now was reported to be more than that of coinbase. DeFi projects that are booming have really helped decentralized trading volume to increase. If DeFi will continue to rise, this will help decentralized exchanges trading volume to increase.

About centralized exchanges, people do use them because of trading flexibility, but with how they are not secure and safe, this could be part of what has reduced their trading volume because people are getting to know how unsecure they are and how they are often hacked, people are looking for more better means to make their funds safe.

I think Decentralized exchanges can do even better if their developers understand that they can do what Centralized exchanges can do, both efficiently and fast.
Once you understand what "decentralized" actually means as a developer, it shouldn't be that difficult to build a simple DEX that can compete effectively with the CEXes. And it's important to build a well or actual decentralized exchange, if you don't want too much problems in the future.
The exchanges have to meet this criteria to be considered well decentralized and safe 👇

https://bitcointalk.org/index.php?topic=5281774.msg55370333#msg55370333

[stompix]

I don't know about you but I prefer to do KYC once on one single exchange and only when I want to cash out instead of having to do KYC every time I want to buy some random shitcoin on some exchange specially knowing many of them will sell your KYC information for some extra money,

Well, I tend to stay away from shitcoins but everyone has its own way of trying to make money although I even then I would stay away from coins that are only available on one exchange. Nevertheless, your whole counterargument ended exactly with the thing I said, no matter how much you dabble with shitcoins on uniswap in the end you need one of those centralized exchanges to transform your coins or even your winnings in fiat as I haven't yet seen somebody who's only occupation and source of income is trading that keeps all his money in tokens on the eth blockchain and never spends a dime.

if your point is we can not have a completely decentralized experience while we are trading I agree with that and as long as Fiat exists that is not possible.

Nope, you can, bisq being one of them although I still don't think of it as totally decentralized, but again, I can't see things like uniswap as an alternative for the current centralized exchanges when they simply lack the features or rather it's impossible for them to have those features.
Besides, it's not just about fiat, as long as Bitcoin is king these will always crawl in the background making squeaky noises.

[CryptopreneurBrainboss]

If DeFi will continue to rise, this will help decentralized exchanges trading volume to increase.

If your use of DeFi is tied to the current trend of just lending and borrowing by worthless shitcoins then we don't need then to grow per se and the decentralized exchange industry can do without them. The DeFi hype contributed to the recent success of the industry but it came with it consequences, the dumping of the coins on new users which is just a repeat of the ico ara and that's something we have to disassociate the industry from i.e the pumping and dumping of coins, using new trend as quick money medium.

With time the community will realize the importance of  using the decentralized exchange, the developers just have to put in work in making the system more friendly, mobile friendly and user friendly. They (the developers) shouldn't chase after the volume and lose in focus on what's is more important.

[Distinctin]

DEX had really won, traders and investor finds out that these exchanges did great things when we talk about anonymity and security.

99% of cryptocurrency transactions still go through centralized exchanges; this trend is expected to be reversed in the coming years. Switching to decentralized exchanges is necessary for cryptocurrency users to exploit their full potential, aligning with the decentralized nature of blockchain itself. Education is arriving, and most technological hurdles we face today will probably be overcome very soon.

source: https://consensys.net/blog/news/decentralized-exchanges-overview-benefits-and-advantages-over-centralized-exchanges/

I saw the gradual effect on the market as many traders intent to change their minds leaving CEX and move to DEX now. The current surge of its volume emphasizes that people are satisfied with DEX performance despite low market prices compared to CEX. But they are not particular of the prices, they took more on the friendly feature that DEX has.

[SquallLeonhart]

I would say it is not a sustainable thing for DEX and it was a hype, something that is only few billion only a few months ago becoming 30 billion dollars today is not the amount that could be continued forever, there is not enough money in the crypto market to sustain these type of increases for a long period of time, obviously there are hypes time to time that takes a while but it will die down anyway.

The reason why CEX is still the king is the fact that they had these kinds of numbers for years now, and DEX  only had it for a few months, which shows the world that you need to actually continue for a while to be respected otherwise you are going to be seen as something that is hyped. DEX would need to continue well into 2021 with these type of volume to be seen bigger than CEX, otherwise it is all temporary excitement and nothing more.