Overview

Decentralised exchanges (DEXes) are digital currency exchanges that allow users to purchase cryptocurrencies through direct peer-to-peer transactions on an online platform without intermediaries. It differs from a traditional centralised exchange, where a typical transaction involves a third party entity (e.g. a bank, trading platform, government institution, etc.) that holds users' funds and oversees the security and transfer of assets between two parties.

Decentralisation is a fundamental philosophy of blockchain technology and the crypto space. It redistributes authority from a central power and puts it in the hands of users. And the concept of decentralisation is reshaping the way many conventional financial services work. Decentralised exchanges have also gained popularity in the last two years, with spot trading volume slowly shifting away from centralised exchanges until early 2022, when the "cryptowinter" arrived.

Decentralised exchanges provide a decentralised platform that allows users to exchange assets without having to entrust their funds to another entity. With a decentralised exchange, a blockchain, or distributed ledger, takes the place of the third party. By moving critical transactions to a blockchain, the underlying technology can help eliminate single points of failure, allowing users to have greater control of their assets, and support more secure and transparent trading. DEXs use smart contracts to execute market trades by mapping transaction operations to autonomous code, but there are multiple variants of order execution with varying degrees of decentralisation [1].

Methods

The intention of this dashboard is to analyze what’s happening on DEX platforms since the collapse of FTX. The data consists of information from different blockchains such as Algorand, Flow, Ethereum, Osmosis and Thorchain. Do users want to remove their crypto from centralized exchanges and use decentralized options for trading? To do so, we will explore the following metrics:

• How have the number of DEX users changed? Are there more unique users?
• Have the number of swaps changed?
• Has the volume (in USD) changed?

Alert: This is an interactive dashboard and readers can choose the best parameters to perform the analysis. Above you will finde two main parameters to be selected:

• Period: here the periodicity (days, weeks or months) has to be chosen
• Number: total amount of days/weeks/months to evaluate

Leave in blank the Chain parameter to be able to explore all the available blockchains.

Once the parameters are selected, press the “Apply All Parameters” button to proceed.

Swapping activity accross the blockchains before and after FTX news

In these first graphs, we can observe the evolution of the main metrics of swap activity before and after the FTX/Alameda news. With this, we take into account the blockchains already mentioned: Algorand, Flow, Ethereum, Osmosis and Thorchain.

In the first graph, we see how the total number of swaps accross the chains increased during the days of uncertainty just after the announcement. But since then, the number of swaps has only gone down and returned to the initial values. Something similar has happened with active swappers, which spiked during the first few days but then plummeted to values below pre-announcement levels. Finally, this last graph to the left of the text shows the volume swapped in all the chains. We can see how during the day of the announcement and a couple of days more, the volume increased exaggeratedly but suddenly it went back to its old ways.

Therefore, in general we can say that the impact of FTX on the DEX has been short-lived.

Evolution of swapping activity and market share of each blockchain

Evolution of swapping activity and market share of each available DEX

In this second approach, we can see the evolution of swapping activity over each specific evaluated blockchain. In blue we have Algorand, in orange Ethereum, in red Flow, in white blue Osmosis and in green Thorchain.

In the first graphs we can see the evolution of the swaps, as can be seen, there is a jump during the days of November where the FTX news came to light. If we look closely, the main rise was due to the increase in swaps of some but not all of the chains, mainly Algorand, Ethereum and Thorchain. In fact, if we look at the distribution graph, we can see how in this case, Thorchain went from 10 to 20% share, Algorand from 5 to 10% while the others lost ground, including Ethereum. A curious fact is that Algorand seems to have maintained this increase in share percentage compared to the other chains, while Thorchain has returned to its previous values.

As far as active users are concerned, we can see that in this case all the chains have experienced similar evolutions, rising during the first days after the news but then gradually falling back to their initial values, except Thorchain. In this case, the distributive charts show that Ethereum and Osmosis dominate the activity in this case, with around 75% and 20% share respectively.

Finally, in terms of volume, as we said before, it rose sharply after the FTX news but then went back to previous values and now seems to continue to fall. If we look at the market share, in this case it is almost 100% dominated by Ethereum, only Thorchain seems to show some competition here.

In this final approach, we analyse the same metrics but in this case for all the DEXes involved in the different blockchains analysed. If we look at the first metric, we can see how the swaps have increased during the days of uncertainty, but then have been decreasing until reaching previous values. In this case, the market share seems to be fairly evenly distributed. We see that Uniswap v2 and v3 take a good part of it, but Thorswap and Osmosis also have a good percentage. However, since FTX, Tinyman seems to be gaining strength and dominance.

As far as swappers are concerned, in this case the evolution of each DEX is similar. We see that the market share is practically dominated by Uniswap and in fact, it seems that since FTX the dominance continues to increase.

Finally, taking a look at volume, we can see that the significant increase in volume just after the news was basically driven by Uniswap and Curve. If we look at the market share, we can see that from the beginning Uniswap v3 has been dominating the market with around 75% of the volume, followed by Curve with approximately 15%. However, since FTX, the volume swapped to Curve soared and caught up with Uniswap, reaching almost 40% share. However, it seems to have declined over the last few days.

Key insights

• The total number of swaps accross the chains increased during the days of uncertainty just after the announcement. But since then, the number of swaps has only gone down and returned to the initial values.

• Something similar has happened with active swappers, which spiked during the first few days but then plummeted to values below pre-announcement levels.

• During the day of the announcement and a couple of days more, the volume increased exaggeratedly but suddenly it went back to its old ways.

• Therefore, in general we can say that the impact of FTX on the DEX has been short-lived.

• There was a jump during the days of November where the FTX news came to light. If we look closely, the main rise was due to the increase in swaps of some but not all of the chains, mainly Algorand, Ethereum and Thorchain.

• Thorchain went from 10 to 20% share, Algorand from 5 to 10% while the others lost ground, including Ethereum. A curious fact is that Algorand seems to have maintained this increase in share percentage compared to the other chains, while Thorchain has returned to its previous values.

• The significant increase in volume just after the news was basically driven by Uniswap and Curve.

• From the beginning Uniswap v3 has been dominating the volume swapped with around 75% of the volume, followed by Curve with approximately 15%. However, since FTX, the volume swapped to Curve soared and caught up with Uniswap, reaching almost 40% share. However, it seems to have declined over the last few days.

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