CRYPTO

DFI and DX volumes rise amid China’s crypto ban and ongoing US control


The heavy hand crackdown on crypto trading crypto in China last week sent a shock wave across the market as Bitcoin and Altcoin prices plummeted after the announcement, but as all crypto-related things have returned to the market, stable traders have found other ways to participate in the market.

Part of China’s goal in restricting citizens’ ability to trade cryptocurrencies seems to be to focus on using cryptocurrencies and discouraging the increasingly decentralized finance (DFI) ecosystem Saw an uprising from.

According to data from Chinalysis, significant amounts of regional bitcoin (BTC) flows have occurred in East Asia, as highlighted by the long orange bar in the graph below. This suggests that crypto holders in the region are turning to their holdings in response to regulatory crackdowns.

Regional BTC is flowing. Source: Chinalysis

According to Chanalysis, “resources usually flow within a region, probably due to local exchange preferences, but flows between regions often result from regulatory concerns, geopolitical changes, or significant market price changes.”

For Chinese residents, the lack of flows from East Asia combined with crypto exchanges such as Hubi and Benin suggests that funds are being kept within the region, but not in a centralized exchange.

Related: Derivatives DEX dYdX beat Coinbase spot markets by volume in China FUD

Profits in the DFI ecosystem

At the same time as this increased movement in the East Asian region, the activity of decentralized exchanges such as Uniswap and Decentralized Derivatives Exchange has increased as Chinese traders seek a safe haven for their crypto activities.

Uniswap Trading Volume vs. Total Revenue. Source: Token Terminal

DydX is a particularly helpful data point because it is now the most widely used decentralized derivative exchange and the demand has increased since regulators around the world dropped hammers on centralized exchanges with KYC policies that provide derivative services.

According to Token Terminal data, dYdX has been in the top-5 ranking rankings for a number of categories over the past week, including token price increases, total protocol revenue, payable fees, price-to-sales ratio and price-to-earnings ratio. Exchange Toll Value Lock (TVL) has risen to the top 6 in terms of growth.

Total Revenue vs. Total Value Locked at dYdX. Source: Token Terminal

A closer look at the available data shows that Layer-to-Protocol and Layer-One Etherium (ETH) competitors also saw some big gains last week, led by glacier-based protocols such as traders Joe and Pangolin. As a phantom network.

After all, recent data shows that the decentralized economic ecosystem is working because it was originally intended to provide crypto holders with a disrespectful way to transact outside the control and reach of governments and financial regulators.

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