Analysis of the Current Status of the DEX Track: 5 Main Trends and Future Development Directions

Since June 2020, the decentralized trading platform (DEX) has rapidly grown amid the DeFi boom, with monthly trading volume increasing 105 times within a year to $20.395 billion. The DEX market started on Ethereum and has gradually expanded to public chains such as BSC, Solana, and Avalanche. Currently, Ethereum DEX still dominates, while other on-chain DEXs have a certain gap in trading volume and locked value compared to it.

The main types of DEX include AMM, cross-chain trading protocols, derivative trading protocols, stablecoin trading protocols, and DEX aggregators. Among them, AMM is the most common type, with Uniswap being the most well-known representative of AMM.

By analyzing the data of the top 60 DEXs, five main trends can be summarized:

1. A few DEXs dominate the vast majority of the market share.
2. The proportion of cross-chain and cross-layer trading protocols has increased, accounting for about 1/4.
3. AMM+NFT is a new trend
4. Major public chains all have DEXs entering the top ranks, and new public chain DEXs are developing rapidly.
5. Stablecoin and derivatives trading platforms have significant growth potential.

In the context of the current market downturn, there are 5 noteworthy directions for the future development of DEX:

1. Established Ethereum DEX ( such as Uniswap, SushiSwap )
2. Cross-chain DEX ( such as Hop, Hashflow )
3. Stablecoin trading protocol ( like Curve )
4. Cosmos ecosystem DEX ( such as Osmosis )
5. New public chain DEX( such as Canto DEX)

In the long term, DEX remains an important pillar of DeFi and serves as the entry point for users to participate in DeFi. The competitive landscape of public chains shows a pattern of "one dominant and many strong", with Ethereum leading and other chains sharing the market. The development of DEX on L2 networks is worth noting, as the advantages of low slippage and low gas fees will attract more users.