Analysis of the top 2 decentralized exchanges
Uniswap and Kyber are the leading finance dapps in the decentralized exchange (DEX) world and both run on the Ethereum blockchain.
A recent analysis of trading pairs on both platforms gave us and our readers a solid understanding of what is happening there. Now, for the first time, we pit them against one another to analyze trading and usage trends.
Uniswap was launched in November 2018 and is an on-chain protocol running on Ethereum which allows the decentralized exchange of tokens using liquidity pools instead of classic orders. That functionality is clearly why Uniswap holds the 1st position.
Kyber is somewhat similar and is currently the second most used dapp in the DEX category. Launched in July 2019, Kyber is an on-chain liquidity protocol that allows the token owners to contribute with so-called reserves to the network’s liquidity.
Key takeaways
- The most popular and common trading pairs on the top 2 DEX’s are ETH/DAI, DAI/ETH, USDC/ETH, and ETH/USDC
- DAI in both DEXs holds 33% and USDC on both Uniswap and Kyber holds 19% and 22% respectively in 2020.
- USDC stable coin usage is growing in Kyber due to the wider variety of trading pairs when compared to Uniswap.
- HEX is the most traded coin on Uniswap in May 2020 and is the number one trading pair with ETH contributing 47% to trading volumes in May 2020.
- KNC is the native token used in the Kyber ecosystem and contributes only 7% to the total volume in May and stands in the top 10 trading pairs with ETH.
Trader count development
The trader count on Uniswap surpassed 3K to date in May compared to January 2020 showing a growth of 101%. Even though Kyber has a similar growth rate in the same time period, the trader count remained around 1.5K.
Trading volume development
On average, up to May 17th, 2020. It can be observed that Uniswap has experienced a peak in volumes showing a 30% growth when compared to January 2020.
On the other hand, Kyber has experienced a drop of 44% when compared to January 2020. When the DEX’s are compared Uniswap maintains the lead position as we enter Q2 2020.
Trading pair comparison
The most common traded stable coins in both DEXs are DAI and USDC which are listed in the top six trading pairs.
DAI
The DAI stable coin contributes 33% to total volume in both Uniswap and Kyber. If we observe the growth of trading month-on-month of the top six pairs; DAI/ETH and ETH/DAI in Uniswap are higher than Kyber.
USDC
The USDC stable coin contributes 19% to the total volume on Uniswap. Whereas in Kyber, it contributes 22% to the total volume. USDC is traded more frequently on Kyber when compared to Uniswap.
The reason for the growth of the USDC stable coin is due to the MakerDao community approving USDC as its third collateral type after ETH and BAT in mid-March 2020.
The best of the rest
On Uniswap, HEX is the trending trade pair and contributes 20% to the total volume. A huge spike in growth occurred in the month of May till the 17th. The HEX token cannot be swapped on Kyber so no comparison can be observed.
Kyber has its own native token called KNC (Kyber Network Crystal) whereas Uniswap doesn’t utilize a native token. KNC token contributes 12% to the total trading volume of Kyber.
Conclusions
The analysis shows that Uniswap continues to be the number 1 DEX on the blockchain. Kyber is second but shows steady growth in terms of trading pairs, trader count, and trading volumes.
The MKR/USDT trading pair on Uniswap and Kyber respectively contribute 9% and 15% to trading volumes.
DAI is the key for both DEX and the reason why we are observing such huge trading volumes in 2020.
It is no surprise that USDC has played a major role in Kyber’s volume growth because of the broad diversity of trading pairs made available.
As of May 17th, ETH/HEX and HEX/ETH is the top trading pair on Uniswap.
Kybers native token KNC has witnessed a decrease in trading volumes to date in May 2020.
DeFi driving adoption
As Uniswap rolls out a completely fresh look and new services to their user-base it will be interesting to track the development of these two main DEX’s. DeFi has the potential to provide the blockchains first killer dapp – But who will it be?
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