Decentralized exchanges began to lose liquidity and market share

Decentralized exchanges began to lose liquidity and market share

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Author: Robert Strickland (crypto-journalist)
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Decentralized exchanges began to lose liquidity and market share

Decentralized exchanges have reduced their market share to 5%


Monthly trading volumes on such exchanges have fallen 71% to $21 billion since January 2022

The market share of decentralized exchanges (DEX) has shrunk to 5% as of the end of June 2023, down from March's peak of 7%, Bloomberg reported, citing data from analyst firm Kaiko.

Monthly trading volumes on such exchanges since January 2022 have fallen by 71% to $21 billion, with centralized crypto exchanges also recording a significant drop in trading activity - by 69%, but liquidity there is much higher (about $429 billion), the publication notes.

Co-founder of hedge fund Digital Asset Capital Management Richard Gelvin noted that the main problem of decentralized exchanges remains the interface. He believes that most investors will prefer such exchanges to centralized platforms because of the ease of use. Gelvin also added that developers of decentralized exchanges do their best to correct errors promptly.

Meanwhile, back in March, against the background of the bankruptcy of U.S. banks and the pressure of regulators on centralized cryptocurrency platforms, the activity of traders on such exchanges increased one and a half times compared to February.

In July, the U.S. Senate announced plans to pass new legislation to close another gap in cryptocurrency regulation, which would introduce strict anti-money laundering requirements for decentralized finance (DeFi).

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