Uniswap [UNI] has been a prominent player in the decentralized exchange (DEX) sector for the past few months. Its user activity has recently increased significantly. According to Token Terminal data, Uniswap has seen a significant increase in daily active users, with the press time figure hovering close to 85,000, a notable high since May 2021.
This increase in user activity could be attributed to the growing popularity of memecoins, which are now in high demand on the market. Despite increased daily activity on Uniswap, the average trade size on the protocol has decreased dramatically.
The decrease in median trade size could be one of the reasons why the protocol’s fees and revenue have decreased despite the network’s high activity. According to Token Terminal data, Uniswap’s fees have decreased by 31.9% in the last month. In addition, according to Messari’s data, Uniswap’s revenue fell by 0.43% during the same period.
Furthermore, the amount of liquidity removed from the Uniswap protocol has increased. There are fewer assets available for trading on Uniswap when there is less liquidity.
As a result, there may be less trading activity and larger price differences between buy and sell orders. As a result, only a few people may use the platform, making it more difficult to find trading pairs. It may jeopardize the platform’s growth and stability in the long run.
These factors, however, have not affected the protocol’s efforts to improve. According to Uniswap’s 19 April tweet, the routers have burned significant ETH. Uniswap routers have burned 11,589 ETH in the last month.
Concerning the UNI token, it was discovered that network growth had slowed significantly over the previous three months. This meant that at the time of writing, new addresses had begun to lose interest in UNI.
The supply held by top exchange addresses, on the other hand, continued to grow, indicating that whale interest in the token remained strong. Despite the high level of whale interest, the price of UNI has continued to fall in recent days.