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Network Coverage: DeFi
This week our contributor analysts cover DeFi: Sushi, Uniswap, and IndexCoop
📈 Uniswap approaches $500B volume, L2 takes off
Uniswap has become the leading decentralized trading protocol — buoyed by v3’s competitive execution quality, Uniswap continues to see strong growth. In the month of September, the v2 and v3 protocols collectively facilitated $51.93B of trading volume, accounting for over 60% of decentralized trading volume market share. Together, all three versions of the Protocol have supported $497B volume since November 2018, with 88% of volume generated since the beginning of the year.
We are starting to see signs of major L2 adoption as users seek out lower fees and faster transaction finality. Six weeks after Arbitrum opened its doors to the public, Uniswap’s deployment has supported $1.28B volume. 34% volume has come in the past week, aided by the launch of Futureswap v4.
Launched on Sept. 16th, the new Uniswap Labs Auto Router (AR) finds the best trades for users, accounting for gas costs and splitting trades up across pools when necessary. Analysis of 4K+ swaps shows that the AR improves pricing on 14% of all trades and 37% of trades between the Top 10 tokens by TVL.
📈 Sushi On Track For $16B Monthly Volume
As crypto transitions into a multi-chain world, Sushi is leading the way deploying its DEX across 14 different chains. Between them, Sushi is on track to having its second-highest monthly volume, projecting over $16B.
Sushi recently became the project with the largest TVL in Arbitrum, with over $370M deposited. Altogether, Sushi’s TVL is at an all-time high, surpassing $6B for the first time.
Despite increasing volume and TVL, SUSHI’s price has trended sideways. This has led its P/S ratio to drop to a 3-month low. With its Miso platform raising $550M in IDOs and upcoming launches of its NFT marketplace and Trident DEX, SUSHI appears to be discounted and with ambitious goals in sight.
③ Index Coop
📈 Index Coop Attracts $61M in N$F in September
Index Coop makes crypto investing safe and easy for everyone through crypto indices. Net Dollar Flows (N$F) measures true growth by disentangling index performance from capital attracted. It measures new capital spent on index products minus capital that is "cashing out." Daily N$F is the product of average price and unit supply change. September was the second best month for N$F in the Coop, attracting $61M in capital to our 6 products with $38.5M attributable to DPI alone.
Comparing products that launched at different times is challenging, but “N$F Since Launch” puts them on relatively even footing. It helps us determine which products are finding product-market fit out of the gate. ETH2x-FLI has been a smash hit, attracting $130M in N$F in just 200 days.
Products can be highly anticipated and attract capital quickly, but the hallmark of a great product is continuing to grow steadily week-over-week. While it ebbs and flows, DPI has shown rapid growth with several weeks of double digit percentage growth in N$F even 6+ months after launch.