Why Decentralized Trading Has 10Xed in a Few Months - Ep.188

Haseeb Qureshi, managing partner at Dragonfly Capital, and Dan Robinson, research partner at Paradigm, discuss the explosion in decentralized exchange activity on automated market makers from $1 billion earlier this year to more than $10 billion in August. 

Why trading in automated market makers has 8xed in a few months

how automated market makers work, and how specific dexes can specialize for the assets being traded on them

why traders would prefer to trade on a dex vs. a centralized exchange

how incentivized pools have drawn traders and liquidity 

why trading on a dex seems can be more appealing than on a centralized exchange

why trading on dexes now mirrors trading on Binance in 2017

how "DeFi is the hottest coolest place where people are making a lot of money"

the difference between the metrics of liquidity, trading volume and total value locked for a dex

why AMMs are capital inefficient

what it means that fees paid on Uniswap are about half of those paid on Bitcoin 

what the purpose of liquidity mining is

why Haseeb doesn't think that dexes have network effects and that once professional market makers come in the space, Uniswap will lose market share

whether users will use DeFi directly through the dexes or through another interface

why Dan thinks that DeFi is now comparable to financial investment in the 1970s 

whether or not yield aggregators like yEarn make it harder for AMMs to compete

what happened with the CRV token launch

initial dex offerings or initial DeFi offerings, like the UMA token launch

whether, because of the high fees on Ethereum and the how long its transition to Ethereum 2.0 will take, DeFi activity could move to another blockchain such as Solana

where DeFi will go over the next few years

 
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Crypto.com: http://crypto.com
 
Episode links: 
Haseeb Qureshi: https://twitter.com/hosseeb
Dan Robinson: https://twitter.com/danrobinson
 
Haseeb’s post on the rise of AMMs: https://medium.com/dragonfly-research/what-explains-the-rise-of-amms-7d008af1c399
 
Haseeb's post on how Uniswap could be un-bundled: https://medium.com/dragonfly-research/unbundling-uniswap-the-future-of-on-chain-market-making-1c7d6948d570
 
Dex volume: https://defiprime.com/dex-volume
 
Trading volume on centralized exchanges: https://www.theblockcrypto.com/genesis/74539/july-by-the-numbers-a-look-at-crypto-exchange-volumes-open-interest-and-miner-revenue
 
Incentivized pools: https://pools.fyi/#/?tag=incentivized
 
Top dexes by trading volume: https://www.coingecko.com/en/dex
 
Ethereum transaction fees: https://bitinfocharts.com/comparison/ethereum-transactionfees.html 
 
Uniswap website visits 15x in July: https://messari.io/article/uniswap-total-website-visits-grew-15x-in-july
 
Website traffic to DeFi platforms explodes in July: https://www.theblockcrypto.com/post/74231/defi-platforms-web-traffic-july
 
Fees paid to various crypto projects: https://cryptofees.info
 
Curve reaches $1 billion in TVL: https://www.theblockcrypto.com/linked/75014/curve-becomes-third-defi-protocol-to-hit-1-billion-in-total-value-locked
 
The Block on dex aggregators: https://www.theblockcrypto.com/genesis/69468/dex-aggregators-user-experience
 
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