Ethereum
Why Ethereum DEX Volume Dropped and How It Impacts Your ETH Holdings
- Ethereum DEX volume hit its lowest level since February.
- This was due to the general drop in demand for the network.
Daily trading volume on Ethereum [ETH] decentralized exchanges (DEX) fell to their lowest level since February, data from Artemis.
According to the on-chain data provider, the value of the total trading volume on these DEXs has soared to $4.8 billion since the start of the year on March 5, after which it started to follow a trend of the decline.
By April 21, it had fallen below $1.5 billion to a two-month low of $1.2 billion.
Users are looking for other options
The decline in Ethereum DEX volume is due to a drop in the number of active traders on these platforms.
According to data from The blockthe number of traders using Ethereum DEXs increased from over 95,000 at the start of the month to around 63,000 last week.
This comes amid a broader decline in user activity on the network over the past month. Data from Artemis showed that the daily number of active addresses that have made at least one transaction on Ethereum has decreased since March 23.
With a daily active address count of 403,000 on April 23, user activity fell 23% over the past month.
Due to the low demand for the chain, the number of daily transactions made on it has also decreased. During the 30-day period under review, Ethereum’s daily transactions fell by 8%.
When a network sees a decrease in daily transactions, its fees are also impacted. Ethereum’s total fees have fallen 29% over the past month.
Is ETH inflationary?
As reported Earlier, the decline in Ethereum network activity made the supply of ETH become inflationary. This happens when the market witnesses an increase in the number of ETH coins created and added to its circulating supply.
Is your wallet green? Check ETH Profit Calculator
This is due to a drop in Ethereum’s user activity and fees, leading to a low burn rate of its ETH coin, thereby increasing its supply.
According to data from Ultrasound.silver, ETH supply increased by 6,867.44 ET over the past month. At press time, the circulating supply of the coin was 120,076,965 ETH.