DeFiance Founder: The Gap Between Leading Crypto Projects and Competitors is Widening

Author: @Arthur_0x

Compiled by: BlockBeats

DeFiance Capital CEO @Arthur_0x shared his insights on the current state of different sectors in the crypto industry on social media, pointing out that in an industry resembling a completely free market where most things are open source, the gap between dominant projects in cryptocurrency and their competitors has not narrowed; instead, it has widened. BlockBeats now compiles the original text as follows:

Decentralized Currency

Bitcoin continues to lead, while other currencies are relatively insignificant, with market capitalizations significantly shrinking, such as Litecoin (LTC), Bitcoin Cash (BCH), and Zcash (ZEC).

Smart Contract L1

Ethereum continues to lead, with the total market capitalization of all Ethereum L2s (Arbitrum, OP, Polygon, Linea, Starkware, zkSync, Mantle) surpassing all other L1s except for BNB, and developers generally prefer to build on Ethereum L2s, except for Solana and some Cosmos App chains.

Trading Platforms

In terms of CEX, for offshore trading platforms, although Binance has recently seen a decline in market share due to legal and regulatory issues, it remains the leader, while OKX is gradually capturing more market share, now offering better products for most traders besides liquidity. Coinbase, as the largest fiat-supported exchange in the U.S., has a market share exceeding that of Kraken, Gemini, and Bitstamp.

For DEX, Uniswap continues to dominate with over 70% market share, while Curve is gradually losing market share, as it takes time to regain trust after suffering an attack. Maverick is the only new DEX that has gained some attention recently.

Liquidity Staking

Lido continues to maintain and expand its dominance, with no other liquidity staking solutions currently seen as capable of capturing significant market share.

Permissionless Lending

Aave and Compound continue to be the two leaders, with Aave's TVL being twice that of Compound. Radiant is interesting, but its TVL is still less than 15% of Compound's. I excluded JustLend, as it is essentially a one-person bank.

Stablecoins

Among fiat-backed stablecoins, USDT continues to dominate, while the supply of USDC continues to decline and is expected to keep decreasing, as it is the easiest to redeem, and holders can typically convert it to T-bill yields easily. pyUSD, using Paypal as a distribution network, is interesting but still in its early stages; historically, all successful stablecoins have needed a top-tier CEX as a distribution partner.

For decentralized stablecoins, MakerDAO is the clear leader in this field. Since the DSR increased to 8% and 5%, the supply of DAI has reversed its trend, making it one of the few DeFi protocols showing growth in this market. Overall, I believe other decentralized stablecoins currently cannot challenge DAI.

Decentralized Derivatives

Despite dYdX's v3 product having no new trading pairs or features for over a year, it remains the leader with over 50% market share. The release of v4 may widen the gap with its peers. SNX and GMX are two other leading perpetual contract DEXs based on LP pool architecture.

NFT Market

This is a rare example where the emerging Blur has taken a significant market share from OpenSea, accounting for over 60%. Of course, this is driven by token incentives, so it will be very interesting to see its evolution after the incentive trading on Blur is canceled.