DeFi Volume Greater CEX Volume

The CCData Exchange Benchmark Report for April 2023 has some interesting highlights for CEXs (Centralized Exchange) and DEXs (Decentralized Exchanges).

You can read the full 61-page deck here, but we’ve also summarized some main points. 

CCData Exchange Benchmark Report: Key Highlights

Centralized Exchange Highlights:

  • Transparency increased with 20% implementing Proof of Reserves or alternative
  • Security standards improve with 30% possessing ISO 27001, SOC2 certificate, or similar
  • Market quality data availability grows, but data quality declines
  • Bitstamp holds the only AA rating, followed by Coinbase with a grade A
  • Exchange KYC practices improving with only 15% deemed to have inadequate practices

Decentralized Exchange Highlights:

  • Uniswap received the highest score and is the only DEX eligible for an A rating
  • Security vulnerabilities remain prevalent with 43.2% of DEXs covered hacked previously
  • Governance participation is declining, and only 4 DEXs experienced an increase in voter turnout
  • Total Value Locked (TVL) dropped to $16.9 billion, down from $21.7 billion in October 2022

Market Quality and Liquidity:

  • Top-Tier volume from exchanges scoring BB and above with 23 rated Top-Tier in DEXs
  • ADV (Average Daily Volume) on leading DEXs, Uniswap and Curve, surpassed volumes on some top centralized exchanges
  • In March 2023, 71% of total volumes were from Top-Tier exchanges based on updated grading, compared to 92% in October 2022

And to close out this summary, look at page 55’s info on the percentage of DEXs that have been hacked.:

Click to enlarge.

Can’t wait to see how things go for DEXs in CCData’s next report. 

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These lending protocols allow users to borrow or lend digital assets, with interest rates typically determined algorithmically based on supply and demand dynamics.

How does lending Work in DEXs?

Borrowers deposit a certain amount of digital assets (often referred to as collateral) into the protocol. The collateral is usually more than the amount they wish to borrow.

The difference between the loan amount and the collateral is known as the collateralization ratio.

For example:

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