We have already mentioned in previous articles on Arab Bitcoin Increased volume and competition among decentralized trading platforms.

And the volume is still increasing month by month.

As is well known, decentralized trading platforms differ from centralized trading platforms in that they do not have any central entity running them and rely on a set of smart contracts as an alternative to the central path.

Most decentralized trading platforms rely on the Ethereum blockchain to operate, which makes them slow and inefficient in terms of fees.

But traders gladly embrace this temporary problem because they have other perks, such as not needing to comply with KYC requirements and not being subject to other regulations and rules imposed by centralized trading platforms.

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Decentralized trading platforms are booming:

The number of decentralized trading platforms has increased, and so has activity on each of these new platforms.

According to the statistics and figures provided by the platform Sand dune analytics. In January 2021, trading volumes on decentralized exchanges crossed the $63 billion mark for the first time ever.

This number is more than double what was recorded in September 2020, when trading volume on DEXs approached $30 billion.

This happened at the height of the DeFi boom.

According to the statistics of “Dune Analytics”, the decentralized trading platform “Uniswap” is the undisputed leader in the sector, with more than $25.8 billion traded in August 2020.

This number contrasts somewhat with research by The Block, which estimated that more than $30 billion was moved that month.

According to “The Block”, the record trading volume on the “Uniswap” platform reached $60.9 billion.

As for the platforms that occupied the following positions, they are “SushiSwap”, “0x” and “Bancor”.

Sushiswap controls nearly a quarter of the trading volume on decentralized exchanges, with 0x owning 7.25% and Bancor 7.1%.

Read:Addresses sent to exchanges for bitcoin hit a record low in the last 30 days

The “Dune Analytics” dataset does not take into account the stats from the popular “1inch” trading platform which has increased its trading volume by more than 1000%.

The statistics platform did not reveal the reasons for this disregard for the “1inch” platform.

But that is likely due to the short operating life of the platform.

Low volume of bitcoin in trading platforms:

Another aspect worth considering is that the supply of bitcoin on centralized exchanges has fallen to an unreachable low in the last two and a half years.

The data collected by Glassnode shows an almost inverse proportional relationship between the evolution of the bitcoin price and the number of bitcoins stored on exchanges.

Glassnode shows that from April 2020 to date, centralized exchanges have seen Bitcoin stocks drop by nearly 3 million BTC to below 2.4 million BTC.

Read:Why is the VeChain project’s VET coin soaring?

This drop matches perfectly with the initial recovery that Bitcoin made after the March 2020 market crash, which started to move in an upward direction to an all-time high above $40K.

One of the reasons for this drop could be that the price hike caused an effect of greed among traders, who refused to sell in the expectation that their Bitcoin would rise more and more over time.

The role of institutional investors that buy large amounts of bitcoin to store it for long periods of time cannot be overlooked here.

All this bitcoin shortage in the markets is driving up prices to rebalance the trading books.

Read also:

A Simple Guide to the 1Inch Decentralized Trading Platform and the 1INCH Cryptocurrency

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