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Trading volume on decentralized exchanges, also known as DEXs, surpassed $11 billion in August, with Uniswap, the dominant Ethereum-based DEX, delivering the most impressive result of almost $7 billion. That being said, the DeFi craze that has started this year keeps on raging.Â
Data: Duneanalytics.com
As of writing this, the total value locked in DeFi is almost $8.62 billion, and $1 billion in trading volume is changing hands right now among 32k of users.  Â
So what is DeFi, or decentralized finance, and DEXs also known as decentralized exchanges?Â
Basically, DeFi leverages decentralized trustless and transparent networks that run without intermediaries. The vast majority of them is built on the Ethereum protocol, but other smart-contract blockchains could work, too.
DeFi networks might cover such traditional actions as lending, borrowing, structuring, derivative products, buying and selling of securities. All of those actions don’t require additional fees that you would have paid if it were the traditional markets.
The most popular dApps to date are Uniswap, a DEX for exchanging ERC-20 tokens on Ethereum, MakerDAO, a protocol to allow lending and borrowing, and Aave, a non-custodial network that onboards new users via fiat.Â
As you can see for yourself, DEXs, or decentralized exchanges, are just a part of the services that the whole DeFI niche leverages.Â
Compared to centralized counterparts, DEXs reduce the risk of theft from hacking since users’ funds are stored on their end. Also, users can avoid hurdles like KYC and transaction fees.
These and other attractions have led to a surge in popularity of the whole DeFi niche and the use of DEXs such as DeversiFi, JustSwap and Uniswap.
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