centralized exchanges saw over trading volume

Centralized crypto exchanges, which hold customers’ private keys unlike decentralized exchanges, reported more than $14 trillion in trading volume in the year 2021, according to The Block Research.

That figure is a massive 689% increase compared to 2020 trading volumes, based on data as of December 24. Last year, centralized crypto exchanges facilitated over $1.8 trillion in trading volumes.

All these numbers are from The Block’s Legitimate Index, which takes volume data from the largest exchanges that are known to be reporting volumes more accurately.

Binance continues to dominate the centralized crypto exchange market. It facilitated 67% of total volumes this year, i.e., over $9.5 trillion, according to The Block Research.

Both centralized and decentralized exchanges saw a huge growth in their trading volumes this year.

The Cons of Coinbase

  1. Expensivefees – Coinbase collects a relatively higher transaction (tx/txs) or trading fees compared to all of Coinbase’s competitors. Unless you invest in Coinbase Pro, you will be charged heavily.
  2. Centralized-Exchange – Since Coinbase is a CEX, customers do not have complete autonomous control over their digital assets.

    This goes against the ethos of a true decentralized financial system, and hence, Coinbase is facing receiving backlash for their actions and double-talk.

Conclusion

Uniswap is one of the rare DEXs that is picking up momentum and taking over the cryptocurrency world. Because of their non-custodial structure and anonymity, they can be used freely by anyone in any corner of the world, with just an internet connection and a device.

Centralized exchanges saw over trading volume

On August 30, 2020, the Decentralized-Exchange (DEX), Uniswap, surpassed the Central-Exchange (CEX) Coinbase in overall cryptocurrency trading volume. Ethereum inventor and developer Hayden Adams revealed that the Uniswap protocol was at a trading volume of $426 million, while Coinbase’s trading volume stopped at $348 million.

Ever since its inception, people were always slightly skeptical about DEX platforms and often argued that they would only forego limited trading volumes.
However, after August 30, the first DEX entered a market that was previously dominated by a small circle of centralized cryptocurrency exchanges.

In this post, we break down the pros and cons of both exchanges.

What is Uniswap?

Uniswap is a decentralized and semi-automatic exchange that allows people to swap ERC-20 tokens on the Ethereum blockchain with their personal wallets.

For transactions to follow through, the protocol only needs a public wallet address. This removes the need for getting a KYC verification done.

  • New Tokens – Uniswap has introduced ERC20 tokens.
    These tokens can be created by any user to generate liquidity for newer pools. In other words, Uniswap gives you instant trading access to their new tokens faster than any other currency.
  • Affordable – Uniswap costs its users around 0.3% fee per trade, which seems somewhat reasonable compared to the centralized exchanges that charge 0.5% and more per trade.
  • Cons of Uniswap

    Even though Uniswap sounds like the perfect DEX, there are certain drawbacks that come along with it as well:

    1. Gas Fees – Since Uniswap runs on the Ethereum platform, all its smart contracts must pay a certain amount of gas fee.

    Centralized crypto exchanges, which hold customers’ private keys unlike decentralized exchanges, reported more than $14 trillion in trading volume in the year 2021, according to The Block Research.

    That figure is a massive 689% increase compared to 2020 trading volumes, based on data as of December 24. Last year, centralized crypto exchanges facilitated over $1.8 trillion in trading volumes.

    All these numbers are from The Block’s Legitimate Index, which takes volume data from the largest exchanges that are known to be reporting volumes more accurately.

    Binance continues to dominate the centralized crypto exchange market.

    It facilitated 67% of total volumes this year, i.e., over $9.5 trillion, according to The Block Research.

    Both centralized and decentralized exchanges saw a huge growth in their trading volumes this year.

    China-based FCoin — unlike in previous months — was the largest exchange by monthly volume at $37.1 billion (up 300%), followed by OKEx and ZB at $35.1 billion (up 12.4%) and $32.4 billion (up 18.8%) respectively.

    In terms of decentralized exchanges (DEX) in April, Ethermium remained the largest DEX in the market with $194 million, despite seeing a 42% volume drop. WavesDEX saw $32.5 million (up 3.5%), followed by IDEX at $31.4 million (up 15.9%).

    Decentralized platforms accounted for just 0.068% of global spot exchange volumes, trading a monthly total of $317 million USD in April, CryptoCompare notes.

    Another trend identified in the report was a 124% increase in the volume of exchanges using a transaction fee mining model, having traded $115 billion in April.

    More transaction traffic can result in more gas fees.

  • Scam Tokens – Uniswap allows anyone to create liquidity tokens. Unfortunately, this can potentially motivate scammers to create fake tokens to fool them into providing liquidity.
  • What is Coinbase?

    Coinbase, on the other hand, is one of the biggest cryptocurrency exchanges in the market today.
    The company is active in over 100 countries and has more than 30 million customers worldwide. Coinbase is known for its diverse range of cryptocurrency trade services that allows users to buy and sell coins on a brand-name platform that is more geared towards institutional investors.

    Centralized crypto exchanges, which hold customers’ private keys unlike decentralized exchanges, reported more than $14 trillion in trading volume in the year 2021, according to The Block Research.

    That figure is a massive 689% increase compared to 2020 trading volumes, based on data as of December 24. Last year, centralized crypto exchanges facilitated over $1.8 trillion in trading volumes.

    All these numbers are from The Block’s Legitimate Index, which takes volume data from the largest exchanges that are known to be reporting volumes more accurately.

    Binance continues to dominate the centralized crypto exchange market.

    It facilitated 67% of total volumes this year, i.e., over $9.5 trillion, according to The Block Research.

    Both centralized and decentralized exchanges saw a huge growth in their trading volumes this year.

    Decentralized exchanges (DEXs) reported more than $1 trillion in trading volumes in the year 2021, according to The Block Research. That figure is a massive 858% increase compared to 2020 DEX trading volumes, based on data as of December 23.

    Last year, DEXs facilitated over $115 billion in trading volumes. Overall, monthly DEX trading volume peaked in May 2021 at $162.8 billion.
    The most considerable month-over-month growth was in January, with a 137.3% gain, per The Block Research’s 2022 Digital Asset Outlook Report.

    Read more : Decentralized exchanges saw over $1 trillion in trading volume this year.

    So What: DEX’s are at the forefront of the new DeFi revolution, but are only one of many entry points to the DeFi world.

    News

    Centralized cryptocurrency exchanges saw a major uptick in traded volume this April, the new April 2019 Exchange Review from crypto data provider Cryptocompare has revealed on May 20.

    Among top fiat-to-crypto platforms, monthly volumes overall increased by a solid 85%. While itself experiencing a 47% drop in volumes, major South Korean crypto exchange Bithumb was the top exchange by total volume in April overall, reporting $17 billion.

    Bithumb was followed by Upbit and Bitfinex at 8.7 billion USD (up 20%) and 6.7 billion USD (up 114%) respectively, the report continues.

    While Coinbase, Kraken, Bitstamp and Coinsbit all similarly experienced an increase in volumes in April, crypto exchange Liquid reported a decrease, according to CryptoCompare.

    Among crypto-crypto platforms, the average volume increase was reportedly 57%.

    Uniswap is popularly known for its simplicity, security, and anonymity. Unlike other exchanges, Uniswap allows you to have a wallet without creating an account or having a Know Your Customer (KYC) requirement.

    With the help of smart contracts, this DEX gives users the freedom to swap tokens, earn commission by contributing liquidity, and even withdrawing liquidity from pools.

    Pros of Uniswap

    1. Security- Uniswap is a non-custodial company, which means that the protocol does not hold any funds.

      It is, in fact, as secure as Ethereum itself. Here the users have access to their own private keys for their wallets when trading on the Uniswap platform. No centralized company has control over the users’ tokens.

    2. Anonymity – Trading on the Uniswap platform can be done directly from the user’s wallet.

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