November Was the 2nd Best Performing Month for Decentralized Crypto Exchanges (DEX), After May
Amidst this, dYdX reported a security issue, but they made a white hat recovery of potentially vulnerable funds. Visor Finance was also exploited last week, which the team insists on calling an arbitrage.
As the global regulatory security over cryptocurrency continues to increase, so does the adoption of decentralized crypto exchanges (DEX).
In the last 12 months, DEXs have recorded $910 billion in total volume. After starting the year at $60 billion in volume, DEXs have only posted an increase in its monthly trading volume, according to Dune Analytics.
Back in May, a record $174.27 bln volume was traded on DEXs. In July, the figures dropped to nearly $74 bln, but they increased in the past three months. Now, at the end of November, DEXs recorded its second-highest monthly volume at $132.8 bln.
Popular DEX Uniswap continues to dominate the space, with its market share increasing to 79.4%, up from 62% in June. Based on daily volume, SushiSwap accounts for the second-largest market share at 11.6%, down from 22.5% from early last month.
Other notable mentions include 0x Native, which is capturing 3.4% DEX market share, Balancer (1.7%), Bancor (1.2%), and Curve (1%).
Amidst the growing adoption, hacks are also surging, with DEX dYdX reporting a security issue. In the past 7-days, compared to Uniswap’s $21.73 bln in volume, dYdX recorded $670,800 in trading volume.
The security issue was with its newly deployed smart contract, but no funds were lost, and all the funds have been reported by dYdX to be safe.
“A white hat recovery of potentially vulnerable funds was executed in partnership with @samczsun and the dYdX team, and all potentially vulnerable funds were saved,” said the team on Twitter over the weekend.
As part of the white hat recovery, the team moved the funds to an escrow smart contract, and whoever set allowance to deposit funds to trade.dydx.exchange were asked to move the funds back to their wallet as only their wallet can access to recover the funds.
If you have set allowance to deposit to dYdX in the past 4 days, go to https://t.co/1WbZbCpiuX immediately to fix a critical security issue with your wallet
❗️DO NOT SEND FUNDS TO YOUR WALLET UNTIL YOU DO THIS ❗️ https://t.co/UvI0wJFk01
— dYdX 🦔 (@dydxprotocol) November 27, 2021
Last week, another DeFi project, Visor Finance, suffered a hack. Mudit Gupta of SushiSwap noted that Visor Finance was hacked multiple times last week. And while user funds were lost in the first incident, they have already been reimbursed, and the rest of the pools were test pools with only team funds.
Meanwhile, the Visor Finance team defined it as an arbitrage, saying it doesn't matter what it is called if user funds are safe.
“It doesn’t make a difference what it is called when it comes to user funds. Cover any position loss with the treasury, protect LP’s, and work on it not being possible again! That is our philosophy,” it said.
Unlike what Visor claims, It was absolutely a bug in the smart contract.
It was an exploit/hack, not an arbitrage.https://t.co/CF3Txe8Fzs
— Mudit Gupta (@Mudit__Gupta) November 27, 2021
When it comes to the price of the tokens of both the projects, while they initially saw a negative reaction, this could very well be in tandem with the broad crypto market and risk assets sell-off.
As of writing, the $769.5 ln market cap DYDX is trading at $12.44, down 55.2% from its all-time high two months back. VISOR, meanwhile, at $1.50, is down 64% from its ATH 7 months back but is up over 32% in the past 24-hours.
Additionally, Visor has $21 million in total value locked (TVL) in it, which has come down $2.5 mln in the last three days, while dYdX has amassed $972 mln but lost about $150 mln over the last month, as per DeFi Llama.