For a long time, decentralized exchange (DEX) has been considered to be able to subvert traditional exchanges with the charm of non-custodial transactions without permission. Although the real disruption has not yet been achieved, as almost all DEX platform tokens performed better this year than centralized exchange platform tokens, investors have increasingly valued this result.

Decentralized exchange (DEX) tokens’ year-to-date returns are more than five times that of their centralized counterparts according to the latest Defi report by cryptocurrency research platform Messari. DEX tokens have increased on average 241% so far this year while centralized exchange tokens have only increased by 44%.

And that’s not including some recent upswings. The report said that Kyber’s token (KNC) was leading the charge with an increase of more than 420%, however after the report was published, KNC nearly doubled in price and LRC increase by 46%, while the top centralized exchange tokens have reduced on average.


Up to now, the annual growth rate of the top 5 DEX tokens has exceeded 100%, making it the best performing crypto asset. These include well-known tokens such as Kyber and Bancor, as well as other tokens that have received more attention, such as Airswap, Loopring, and IDEX. Centralized exchange platform tokens are still growing this year, but the increase is generally in double digits. Obviously, one main trend has emerged, and DEX has aroused increasing interest:
 
The proportion of DEX transactions in the overall transaction volume has increased

Regarding the first trend, the daily spot trading volume of DEX increased from less than $5 million at the beginning of the year to approximately $25 million. The total trading volume of DEX is not only increasing but also faster than the centralized exchange, because the percentage of the total trading volume of DEX has increased from 0.25% to 0.5%.

One factor that may cause this situation is the increasing popularity of DEX aggregate transactions, which optimize the trading experience by introducing smart order routing into the decentralized financial world. By allowing traders to split orders at different locations, they can get a better transaction price, which is crucial in today’s digital currency market that sacrifices costs for various features of decentralization.

Another way for DEX to compete for market share in centralized exchanges is to increase throughput and reduce latency. ByteBulls white label cryptocurrency exchange solutions adopt a technical combination based on DPOS + PBFT consensus mechanism, cross-chain support and network-wide shared order book with an automatic on-chain matching engine, in addition, ByteBulls also has CCXT Certified Trading API. It can complete an order within 3 seconds, and finally realizes the same trading experience as a centralized trading system.

DEX is unlikely to compete with the scale of the centralized exchange’s revenue in the near future. Head-centered exchanges are liquid, and the existing user base provides them with clear advantages. However, DEX always has the advantage of their ability to automate revenue in a completely transparent manner. Although any centralized exchange can prove that a certain percentage of revenue has been destroyed, they cannot enable token holders to verify each transaction and allocate commissions as expected.

Therefore, although the market value of DEX tokens and the related volume-based gains may be much smaller than the centralized exchange tokens of cryptocurrency giants, But the recent and upcoming DEX token economics and scalability upgrades are helping these. So far this year, the market has rewarded those who use DEX. DEXs are ushering in new development opportunities.

As a Blockchain Solution Provider, ByteBulls aims to improve the current DEX marketing situation with an innovative DEX solution. Based on market status, ByteBulls decentralized Exchange Solution has made improvements and optimizations, considering the advantages and disadvantages of centralized and decentralized exchanges, and hope to build a prosperous decentralized exchange ecosystem with good user experience, which everyone has the opportunity to participate in.
Schedule an obligation-free call with our experts to learn how you can capitalize on the upcoming crypto opportunities.