Uniswap exchange volume explodes after launch of new DeFi token, what’s going on here?

Uniswap, the most popular decentralized trading platform, or DEX, on Ethereum (ETH) suddenly saw a massive surge in daily trading volume over the past two days.

On March 29, the volume shot up by no less than 450% according to data on info.uniswap. Normally, the DEX trading volume is around $ 1 billion per day, but on March 29 the volume rose above $ 7 billion and on March 30 even above $ 11 billion.

This huge increase is due to the launch of a new cryptocurrency on Ethereum called Delta Financial. The decentralized finance (DeFi) project consists of two tokens, DELTA and rLP, and these can only be traded through Uniswap.

The project aims to make options trading less volatile by making liquidity more stable. For this, the project uses a unique rebase function, which makes the creation of new tokens increasingly expensive.

These rebase trades remove 90% of the liquidity and repeatedly trade it at the remaining 10%. This makes the rLP token scarce, but this has the side effect that a lot of volume is generated. So much volume that Delta was even responsible for 90% of Uniswap’s trading volume. Hayden Adams, founder of Uniswap, did not call it wash trading, but also not “real” volume:

Delta was subsequently removed from the list on the website and that is not without controversy. According to critics, this shows that Uniswap may not be as “decentralized” as thought. The Delta team says all data is frozen, as if no trading is taking place at all.

Subsequently, a developer from the CORE team launched a new contract called “You don’t blacklist Delta Financial,” which generated trading volume of up to $ 11 billion on Uniswap:

“Anyone can now create $ 20 billion in volume! The attack will continue until DELTA’s trading history is restored and we receive an apology from Uniswap for the misuse of centralized power. ”

It has now also been removed from the Uniswap website. This brings the record daily volume on the website back to $ 2.22 billion, which was reached on October 26.

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