Crypto investors traded over $1 billion worth of Ethereum tokens across 24 hours on decentralised exchange, Uniswap. The platform has become the first of its kind to hit a 10-figure volume thanks to the growing trend of yield farming.
The growing popularity of Decentralised Finance has become a revelation for Uniswap with the decentralised exchange benefiting immensely from the surge in yield farming. Investors continue to flood the market with multiple tokens exchanges over the past few weeks. The yield farming frenzy peaked on Sep. 2 with $1.02 billion worth of DeFi tokens being traded over a 24-hour period. This value has seen Uniswap v2 rise to become the third largest crypto exchange by trade volume. Currently, the relatively young exchange only ranks below Binance and OKEx whose daily trade volumes are $6.25 billion and $1.1 billion respectively. Uniswap’s dramatic rise has catapulted it above major crypto household names such as Coinbase, Huobi and Bitfinex.
Uniswap’s remarkable success has also helped it ascend the DeFi protocol charts with the DEX toppling the leaders based on amount of locked funds. According to data gathered by DeFi pulse, Uniswap is the top ranking DeFi protocol with $1.69 billion of locked funds. This represents around 18% of the total value of locked funds in DeFi.
Crypto experts and industry insiders are however predicting that the protocol’s downfall may come as fast as its rise. This is due to the increasing number of forks seeking to ride on the yield farming wave by eating into Uniswap’s market share. Rival forks are employing tactics labelled as ‘vampire attacks’ that are aimed at draining liquidity from Uniswap. These forks are offering several incentives to appear more attractive to users. These tactics appear to be working with SushiSwap, an unaudited fork of Uniswap, managing to get over $1.47 billion worth of locked funds on their platform.
Other platforms are employing similar tactics with recently launched Uniswap forks like yuno.finance, Hotdogswap, pizzafinance, and Kimchi all offering great incentives to lure users to their unaudited platforms. These platforms are offering outrageous returns of millions percent on their investment. Obviously investors should be wary as there is no possibility of such returns. Rather these are potential scams seeking to ride the wave of yield farming. This is best illustrated by the quick demise of the Hotdog native token that collapsed from $4,000 to $1 within just 5 minutes.
Image courtesy of pixabay
Don’t worry, we hate spam too
one weekly digest, just the important stuff.
How about some social? Follow us on Twitter!