Uniswap Chain Showdown: Evaluating the Performance of Different Networks
Uniswap has successfully launched on eight different chains. This analysis aims to delve into the performance dynamics of Uniswap upon the launch of each chain. We will conduct an in-depth examination of the performance metrics associated with the top six chains, namely Ethereum, Polygon, Arbitrum, Optimism, Binance Smart Chain, and the Base chain.
Furthermore, by scrutinizing the performance of Uniswap on these key chains, we seek to discern any discernible patterns, trends, or variations that may have occurred during each launch. This comprehensive evaluation will provide valuable insights into the platform’s adaptability and effectiveness across diverse blockchain ecosystems.
Uniswap Overview — Swap Count & Volume (USD)
The initial Layer 2 implementation introduced to Uniswap was Arbitrum, launched in August 2021. Subsequently, Optimism followed as the second layer, and Polygon was introduced thereafter. The latest addition to the Layer 2 ecosystem is Base, introduced during the heightened popularity of friendtech.
Upon examining the swap count overview, it is noteworthy that there was no significant increase in weekly swap counts until the mid of 2022. However, a notable shift occurred at this juncture, revealing a substantial surge in weekly swap counts, consistently maintaining levels exceeding 1.5 million swaps per week. This marked uptick in swap activity may be indicative of a growing user base or heightened adoption of Uniswap on Layer 2 solutions during this period.
The swap count on Ethereum appears to have remained relatively static. However, the notable escalation in the weekly swap count can be attributed to the contributions of Polygon, Arbitrum, and Optimism. These Layer 2 solutions have played a pivotal role in propelling the weekly swap count to unprecedented levels, experiencing a growth rate surpassing fivefold. This surge underscores the significance of these Layer 2 implementations in augmenting Uniswap’s transactional activity and highlights their instrumental role in the broader ecosystem.
Despite the notable surge in swap counts across various chains, it is evident that the swap volume in terms of USD remains predominantly concentrated on the Ethereum network. Even amid significant spikes in swap volume, Uniswap continues to play a central role, underscoring its continued dominance in facilitating transactions. This persistence in Uniswap’s prominence in the overall swap volume underscores the robust purchasing power and transactional strength inherent in the Ethereum ecosystem. This observation reinforces the notion that Ethereum remains a powerhouse in terms of transactional value within the broader decentralized exchange landscape.
From an average standpoint, it is discernible that Ethereum users exhibit an average swap volume exceeding 10,000, with Arbitrum and Optimism following closely. This analysis of average swap volumes provides valuable insights into user behavior and preferences on these respective blockchain platforms. The consistently high average swap volume on Ethereum underscores its prominence as a preferred and substantial hub for decentralized exchange transactions. Arbitrum and Optimism, while trailing behind Ethereum in average swap volumes, demonstrate substantial user engagement, contributing to the overall vibrancy of the decentralized exchange ecosystem.
Gas Fee Paid On Uniswap
At the height of the 2021 bull market, the total gas fees incurred for transactions on Uniswap soared to an astonishing 40 million USD per week. The magnitude of this figure, solely for gas fees, is notably significant. However, a positive development has emerged with the expansion of Uniswap onto various chains. This diversification has led to a subsequent reduction in weekly gas fees. The strategic deployment of Uniswap across different chains is proving instrumental in addressing scalability challenges, ultimately enhancing the overall user experience in decentralized exchange trading. This shift reflects a proactive approach to scaling solutions, aligning with the evolving needs of the decentralized finance landscape.
Users Behavior on Uniswap by Chain
As of the present, Ethereum boasts the highest count of unique traders, attributable to its longer existence in the market. An intriguing observation from the provided chart is the remarkable surge in unique traders on Arbitrum, commencing in March 2023, which has now surpassed the number of unique traders on the Polygon network. This noteworthy development signifies a substantial uptick in user adoption and engagement on Arbitrum, potentially influenced by its distinctive features or market dynamics. The data underscores the dynamic nature of the decentralized exchange landscape and the emergence of alternative blockchain solutions gaining prominence over time.
In terms of user retention rates, Optimism stands out with the highest retention rate, as more than 65% of its users return to perform additional swaps. This is a noteworthy observation, especially considering that Optimism has fewer unique traders compared to Arbitrum and Ethereum. Following closely are Arbitrum and Ethereum in terms of retention rates. Conversely, the Binance Smart Chain (BNB) exhibits the lowest retention rate among the chains under consideration. The robust retention rate on Optimism suggests a high level of user satisfaction and engagement, emphasizing the platform’s ability to foster continued user activity despite a comparatively smaller user base. Conversely, the lower retention rate on BNB may warrant further analysis to understand the factors influencing user engagement on that particular chain.
A compelling observation emerges from the data, revealing that 85% of Uniswap users engage exclusively with a single chain, refraining from cross-chain trading on the Uniswap platform. This underscores the significance and persistence of Uniswap’s strategy to launch on different chains. The strategic diversification across multiple chains proves instrumental in garnering distinct user traction. By catering to users on various blockchain networks, Uniswap is effectively capturing and retaining a diverse user base. This insight emphasizes the importance of adaptability and the tailored approach to decentralized exchange services to meet the preferences and behaviors of users across different blockchain ecosystems.
Market Penetration Percentage by Chain
An intriguing revelation stems from the analysis of the market penetration chart, where market penetration is defined as the ratio of Uniswap transactions on a specific chain to the total transactions on that chain. This metric serves to elucidate and assess the extent of Uniswap’s dominance within various blockchain ecosystems.
The chart indicates that Optimism emerges as the highest-performing chain, achieving an impressive 30% market penetration relative to total transactions on the Optimism chain. Following closely is Arbitrum, exhibiting a noteworthy market penetration rate of over 9%. In contrast, Ethereum, Base, and Binance Smart Chain (BNB) display market penetration rates of less than 2%, suggesting a highly competitive environment on these chains. This observation underscores the strategic importance of expanding Uniswap onto chains with lower competition to enhance market penetration and foster a more impactful presence within specific blockchain networks.
Top 10 Token Trade by Chains
The singular behavior of Uniswap users exclusively engaging with a single chain can be elucidated by examining the top 10 token trade volumes on Uniswap across various chains. Notably, certain unique tokens are predominantly traded on specific chains; for instance, ARB sees the highest trading volume on the Arbitrum chain, while OP and SNX are primarily traded on Optimism. Additionally, a discernible trend emerges in the top 10 token trades on Arbitrum, where ETH largely dominates the trading landscape. Furthermore, it is noteworthy that Optimism exhibits the highest proportion of volatile assets within its top 10 traded tokens, exemplified by the prevalence of OP and SNX. This nuanced analysis sheds light on the chain-specific trading preferences and token dynamics that contribute to Uniswap users gravitating towards singular chain engagements.
Conclusion
In conclusion, the comprehensive analysis of Uniswap’s performance across various chains provides valuable insights into the decentralized exchange’s adaptability and impact within distinct blockchain ecosystems. The platform’s strategic expansion onto different chains has not only addressed scalability concerns but has also contributed to a notable reduction in gas fees, enhancing the overall user experience. Ethereum continues to assert its dominance in terms of total swap volume and user count, owing to its longer presence in the market. However, the emergence of Layer 2 solutions such as Arbitrum and Optimism, along with the strategic addition of other chains, has significantly diversified Uniswap’s user base and transactional activity. Notably, Optimism stands out with the highest user retention rate and an impressive market penetration on its chain, signaling strong user engagement. While each chain presents unique strengths and considerations, Optimism’s performance metrics suggest it currently holds a distinctive position as a high-performing and user-engaging blockchain within the Uniswap ecosystem.
Reference
Dune Dashboard:
https://dune.com/ahkek/uniswap-by-all-chains
