DEX market share surges compared to CEX, Solana Foundation: DeFi growth rate "unprecedented"

The Block data shows that the ratio of DEX to CEX spot trade volume is reaching historic highs, indicating that the DeFi ecosystem is growing at an unprecedented rate. The Solana Foundation has also acknowledged this trend, stating that choosing the right blockchain will be a crucial factor for developers.

DEX Market Share Hits All-Time High, Raydium Stands Out

The ratio of decentralized exchange (DEX) to centralized exchange (CEX) spot trading volume has reached a one-year high, suggesting that DEX is gradually gaining significant market share in the cryptocurrency market.

The chart above shows that DEX's spot trading volume share compared to CEX has reached 13.76%, surpassing the previous high of 13% before May last year.

This shift comes at a time when DEX monthly spot trading volume has seen a continuous decline for four months. Among them, the market share between DEXes has seen Raydium's outstanding performance, growing from 7.93% at the beginning of the year to 21%, capturing a portion of the market dominance from Uniswap.

On the CEX side, Crypto.com and Bybit have emerged as leaders in the fiercely competitive North American and global offshore exchange markets.

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Solana Foundation: DeFi Rapidly Expanding

In a recent report, the Solana Foundation made similar findings, stating that despite DeFi facing challenges such as financial instability and regulatory pressures, it is creating new markets and penetrating existing crypto markets at an unprecedented pace.

Current Challenges in DeFi

Having transitioned from lending and yield farming to tokenomics and staking, the Solana Foundation attributes the explosive growth of the DeFi ecosystem to the introduction of various stablecoins, labeling them as a key "killer app."

However, they also acknowledge that with the expansion of DeFi, obstacles faced by projects and developers are becoming increasingly apparent, including:

• Unclear regulatory environment with hostility from U.S. authorities

• Unstable market demand due to highly volatile market sentiment

• Challenges in sustaining user incentives

• Information security risks

Additionally, the Solana Foundation emphasizes that the unique characteristics and intensified user competition among applications are due to technical differences between blockchains:

As a result, blockchains with a large existing user base and the lowest related costs will attract a different set of developers.

Diversification Stirring DeFi Variability

Nevertheless, the Solana Foundation remains optimistic about recent developments in DeFi, stating that the development of diversification and super applications is accelerating the variability of the DeFi ecosystem.

They highlight examples such as Solana Actions and Blinks, which simplify user experiences, and TON, which integrates the advantages of social media into the ecosystem.

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Finally, the Solana Foundation describes the recent development of DeFi as "fast and dramatic," stating that it is creating new markets and penetrating existing ones:

Trends indicate that integrating with existing Web2 infrastructure, improving user experiences, fostering community interactions, and devising methods to enhance user loyalty are all effective factors for the success of DeFi projects.

They add, "As current challenges intensify and developer competition increases, the choice of blockchain becomes particularly important at this time."