Uniswap DEX captures 37% of Ethereum L2 volume

Uniswap, the most widely used decentralized Layer 2 Exchange (DEX) built on Ethereum, now accounts for approximately 37% of the total trading volume on L2.

This represents a notable increase compared to trading volumes seen two years ago.

Uniswap L2 volumes surged over 650%

In a post on X, Tom Wan, a researcher at 21.co, noted Uniswap’s Layer 2 (L2) volume growth, which has increased by more than 650% over the past 24 months. This increase saw its volume rise from approximately $4 billion in 2022 to more than $30 billion this year.

.@UniswapL2’s trading volume is growing and currently contributes to 37% of the total volume

Since 2022, Uniswap volume in L2s has grown from $4 million to $30 million (+650%). Uniswap’s L2s volume in 2022 only contributes 5.2% of the total volume

The L2s have been winning more… pic.twitter.com/PR7GT9xdih

— Tom Wan (@tomwanhh) April 29, 2024

Wan suggested that this trend could continue to strengthen, especially with the launch of more quality protocols on Layer 2 networks such as Arbitrum, Coinbase’s Base and Optimism.

According to Wan, L2s, especially Base and Arbitrum, have witnessed an increase in economic activities, accounting for 82% of the total L2 volume on Uniswap. Wan predicts that L2 volume dominance on Uniswap will likely grow to 50% by the end of the year.

Although Uniswap has only contributed 2.9% of the total volume of the altcoin layer 1, Wan believes that this narrative could evolve. He explained that the high-performance Ethereum Virtual Machine (EVM) compatible Layer 1, combined with a multi-chain expansion strategy, could allow the DEX to capture more volume on networks like Sei and Monad.

Uniswap, the first decentralized exchange on Ethereum, continues to maintain its position as the largest on-chain trading site on the Ethereum Layer 1 blockchain. The protocol has facilitated more than $2 trillion in cumulative trading volume across 17 chains . According to DefiLlama data, users have deposited more than $5.5 billion in total locked value on Uniswap.

Uniswap faces regulatory pressure from the SEC

Uniswap, amid its continued success, is facing regulatory pressure from the US Securities and Exchange Commission (SEC) as part of a broader regulatory crackdown on the crypto-exchange market.

The SEC has issued a notice from Wells to Uniswap, indicating likely enforcement action. Despite this development, Uniswap intends to defend a decision that it considers “disappointing but not surprising”.

This lawsuit comes amid widespread criticism from the crypto industry of the SEC’s approach. Many argue that the SEC has been operating in bad faith. Critics claim that the SEC has taken enforcement actions without considering the unique characteristics of blockchain-based technology in the crypto sector.

In response, SEC Chairman Gary Gensler has defended the SEC’s actions, stating that existing securities laws are clear and that the crypto sector has sought special treatment without complying.

Meanwhile, UNI is trading at $7.68, up 0.9% in the last 24 hours, but down 6% over the past week.

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