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In an unexpected turn of events, Binance's BNB Chain has recorded its most substantial weekly trading volume within the decentralized exchange (DEX) realm in over a year. Data from DefiLlama, a reputable source for decentralized finance (DeFi) insights, confirms this upward trend.
Starting on May 7th, the trading volume within the DEX realm on the BNB Chain surged to an impressive $5.11 billion, reaching a level not seen since May of the previous year. Interestingly, the volume briefly spiked above $5 billion in the week following the unfortunate downfall of the crypto exchange FTX in November.
A potential catalyst for this surge is the growing popularity of DEXs. The stringent regulatory measures imposed by United States regulatory bodies on centralized exchanges may have contributed to this growth. As an illustrative example, DEX Uniswap surpassed the centralized exchange Coinbase in trading volume for four consecutive months by April.
The peak yearly volume on the BNB Chain is a result of multiple factors. According to Katie Talati, Arca's head of research, the reduced fees on the BNB Chain could incentivize users to conduct their trading activities there. She also suggested that Binance's reputation within centralized exchanges could be a driving force. Talati speculated that users naturally gravitate towards the BNB Chain after using Binance.
Charles Storry, head of growth at the crypto index platform Phuture, concurred with Talati. He highlighted the benefits of Binance's listing and marketing support as key motivators for projects. Storry remarked that the often overlooked advantage of getting a Binance listing when a project gains traction is a significant factor. He observed that many projects aim to capitalize on their relationship with Binance.
Furthermore, the introduction of Uniswap, the DEX with the highest trading volume, to the BNB Chain in March could be another contributing factor. The combination of Uniswap's expansion onto the BNB Chain and Binance's status as the largest crypto exchange has stimulated increased trading volume on the chain, added Talati.
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