Following a spate of fresh Chinese crackdowns on account registrations, investors are starting to turn to DEXs (Decentralised Exchanges) to continue trading cryptocurrencies.
The leader of the pack is DyDx – a Layer-2 DEX that offers trading via Web3 wallets such as Metamask. According to data from CoinMarketCap, DyDx has now handled more than $6bn in trading volume in the past 24 hours – contributing to over 50% of the DEX market share in the same period.
DyDx founder Antonio Juliano also tweeted that the DEX is now doing more trading volume than Coinbase, which handled $3bn in the same 24 hour period.
Additional data from CoinMarketCap shows that DyDx also surpassed Huobi in 24-hour trading volume, which clocked up $5.6bn in trading volume.
5 years ago I left @coinbase and eventually founded dYdX
Today, for the first time, @dydxprotocol is doing more trade volume than Coinbase 😯📈 pic.twitter.com/QzoKAUpH29
— Antonio | dYdX (@AntonioMJuliano) September 26, 2021
Data from Layer-2 aggregator L2Beat also shows that deposits made into DyDx have gradually increased to highs of almost $500m in the past week.
Further insights from its public dashboard reveal that both cumulative and daily volume on the DEX have reached all-time highs following the crackdown.
The surge in DEX interest started when Huobi – a leading exchange for Chinese investors – said that it would suspend all China-based user accounts later this year.
Huobi notified investors in an announcement made on Sunday that “Huobi Global will gradually retire existing Mainland China user accounts by 24:00 (UTC+8) on Dec 31, 2021”.
The announcement reaffirmed the safety of user assets and that users will be informed of the “specific arrangements and details” through further announcements made via official channels.
Huobi’s decision was made following China’s latest crackdown on cryptocurrencies. Investors were informed last Friday that crypto-related activities will be treated as illegal and overseas crypto companies will be banned from serving Chinese investors in the latest reiteration of “China FUD” to afflict the market.
Binance followed suit and also suspended the registration of new users using Chinese phone numbers in mainland China. Other exchanges that serve Chinese investors such as OKEx have yet to comment.
The announcement led to sharp declines in the prices of the native tokens of Huobi and OKEx – HT and OKB.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.