Uniswap’s decentralized model is outperforming Coinbase in spot trading, reflecting a shift in the market. Coinbase’s 83% drop compared to Uniswap’s 50% drop shows decentralized strength. In a stunning turnaround, leading decentralized exchange Uniswap has emerged as the leader in spot trading, surpassing major US crypto exchange Coinbase by 2023. A recent report by Bitwise Crypto Asset Manager Ryan Rasmussen reveals a compelling trend that underlines the growing importance of decentralized protocols. In the second quarter of this year, Uniswap achieved an impressive feat of processing approximately $110 billion in transactions, compared to Coinbase’s $90 billion. This follows a trend set in the first quarter, when Uniswap’s quarterly spot volume surpassed that of Coinbase, trading around $155 billion. And $145 billion for both exchanges.
The difference becomes even more significant when looking at the consequences of the bear market that plagued the crypto industry in 2022. Coinbase’s trading volume increased by 83% in the fourth quarter of 2021, which was almost $540 billion. In contrast, Uniswap’s volume fell by a relatively modest 50% from $235 billion over the same period. Centralized crypto businesses, including exchanges and venture capital firms, will suffer heavy losses in the bear market of 2022.
Decentralized protocols like Uniswap have proven their ability to operate independently of human intervention and rely on immutable code. In addition, Binance CEO CZ, a well-known figure in the crypto space, also supported this story. He tweeted, “DeFi is taking over,” further reinforcing the growing influence of decentralized finance in the field. How has this affected the price of Uniswap (UNI)? Amidst this growth, however, Uniswap’s original token UNI has seen a 10 percent increase in value during 2023. This decline occurs despite the exchange’s significant increase in trading volume this year. And now it’s down 9% in 24 hours. The current price is $4.60, down 3.26% in 24 hours. It should be noted that UNI is well below its May 2021 ATH and is 90 degrees below its peak. A breakdown of UNI holdings by extended duration published by IntoTheBlock shows a breakdown where 73% of holders held for more than a year, 26% for 1-12 months and only 2% for less than a month. This pattern suggests a strong foundation for long-term investors who are committed to the project despite short-term market fluctuations.