The Most Technologically-Promising Decentralized Exchanges (Dexs) In Defi Today
In this article, we look at some of the hidden DEX projects that show the most potential to make it to the top five projects in the near future. As we expect at least two projects to remain on this list, we list three of the most promising projects here.
For the past five years, the cryptocurrency and blockchain ecosystem has been in an era of exponential value growth and hyper-adaption, whereby the industry’s growth curve hits an inflection point and heads to the stars. Across this period, the industry has witnessed massive growth in development., with the decentralized finance (DeFi) ecosystem and non-fungible tokens (NFTs) playing a huge role in the wild expansion of the industry.
The emergence of exchanges, especially centralized exchanges (CEXs), is one of the main reasons the adoption of crypto reached every corner of the globe. With a number of exchanges being launched across every continent, many first-time investors have found their way in the world of crypto but with one concern - privacy and control of funds.
To this end, many investors have braved the path into decentralized exchanges, or DEXs, which allow users to have total control over their funds and transact/swap tokens anonymously on the blockchain. Notwithstanding, these platforms offer a wider range of token pairs, better security, and more earning capabilities than their centralized counterparts.
The Wild Swing By Traders: Decentralization or Not?
According to Glassnode data, the total net flow of Bitcoin on centralized exchanges has been largely negative over the past two years (as seen in the chart below). While it may not paint the full picture, this sample shows traders are largely moving from CEXs in favor of holding their own tokens.
Net transfer volume from/to centralized exchanges (2020-2022) (Image from Glassnode)
On the flip side, decentralized exchanges have been on their best two-year run in traded volumes, total value locked (TVL), and token value. Looking at data provided by DeFi Pulse, the DEXs industry has experienced explosive growth, currently with a TVL of $34.45 billion across listed protocols, representing over 1,500X growth since January 2020. Uniswap ($UNI) leads the field with over 50% dominance, with Curve ($CRV), Balancer ($BAL), Bancor ($BNT), and Sushiswap ($SUSHI) closing out the top five largest DEX projects.
If you have made it this far in the article, you may be looking for the next potential project that will make it to the top five largest DEX projects list in the near future. Below are some of the most promising projects currently showing futuristic advancements that may set them on this list.
The Most Promising Dex Projects to Look Out for in 2022
When launched DEXs were specifically for swapping between tokens and digital assets. However, the industry has greatly transformed since DEXs today offer far more than the swapping functions. In this section, we look at three of the most promising DEXs offering a wide range of utilities and features.
1. Polkadex
Ranked 909th largest cryptocurrency and only 50th in the Polkadot ecosystem, Polkadex is one of the most promising projects in the DEX ecosystem today. Built on Substrate, Polkadex is a fully decentralized, fast, and multichain crypto exchange, powering the DeFi ecosystem. The platform is built combining the benefits of centralized and decentralized exchanges to give users a simplified but cutting-edge experience.
Polkadex includes three main features namely the Polkadex Orderbook, Polkadex IDO platform, and Polkadex Mobile. It allows users to create a fully decentralized platform for exchanging tokens in a peer-to-peer trustless environment, while additionally enabling high liquidity, lightning-fast transaction speed, and advanced trading features such as high-frequency trading and trading bots.
The Orderbook allows users to own and control their assets, keeping them safe while saving on transaction fees. What sets it apart, however, is that users can delegate their assets to third parties allowing them to make profits through algorithmic trading while still keeping control of your crypto assets. Finally, users can connect hot wallets based on browser extensions, mobile phones, or iPads and add on-chain trading bots to automate trading with their funds.
The Polkadex IDO Platform allows token projects to create ERC-20 like tokens. Teams can raise funds and get listed on the Polkadex exchange in one click. Polkadex Mobile allows traders to place, modify and cancel trades from their air-gapped cold wallets as well as receive funds directly to it.
2. Pangolin Exchange
Once ranked as Avalanche’s most prominent DEX, Pangolin exchange has dropped to third, with a total of $226 million staked on the protocol. Much has been written on the rivalry with the current number 1 DEX on Avalanche ($AVAX), Trader Joe, but Pangolin makes this list out of its latest partnership and innovations.
Earlier this month, the Pangolin exchange community announced its latest DEX-as-a-Service (DaaS) model to make trading much more efficient for users. The newest project by the Pangolin team is available for any project on the Avalanche C-Chain or subnets. Simply, the DaaS model allows blockchain projects to integrate the ‘Pangolin swap widget’ in less than an hour and access all the liquidity and functionality that Pangolin offers traders, including limit orders.
This is a first-of-its-kind-in DeFi space, with the GameFi industry benefiting greatly from integrating in-game swap features. In the announcement, Pangolin also confirmed its partnership with DeFi Kingdoms, a blockchain game with over $2.2 billion in TVL, to implement its swap widget within the game.
3. WanSwap
Launched in 2021, WanSwap, a cross-chain that offers users a complete DeFi trader toolkit, is the last project on our list. The DEX widens the scope for its traders to find the best liquidity rates, crypto pairs, and cheapest fees on multiple blockchains including Bitcoin, Ethereum, and EOS among others. This allows for the platform to draw more liquidity, enabling high-frequency trading and users to implement multiple trading strategies.
The platform allows users to swap multiple assets back and forth between Wanchain and their native chain using Wanchain’s cross-chain Storeman Node-based bridges. The recent launch of its Wanchain 5.0 brings a major update to the decentralization and security of Wanchain’s cross-chain bridges. After 5.0, Storeman bridge-based cross-chain swaps will be truly trustless and decentralized. This allows WanSwap users to transfer assets from any Wanchain connected blockchain and trade them against each other on WanSwap.
Finally, the DEX also offers yield farming opportunities with high APR rates, liquidity pooling services, and its Hive feature, which allows automatic staking and re-staking of the rewards, earning more yield.
The protocol currently boasts $30 million in total locked value, with a total market capitalization of $3 million, a 1:10 in market cap to TVL ratio.
Could each of these projects reach a billion dollars in market capitalization? Let us know in the comments.
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