Layer-2-based DeFi and DEX platforms grow parabolically

Layer 2 based DeFi and DEX platforms have seen a staggering increase in user activity, revenue and Total Value Locked (TVL) since the introduction of the cross-chain bridge (cross-chain.chain) by Arbitrum and Avalanche.

In the increasingly competitive landscape of blockchain technology and cryptocurrencies, protocol innovations and the ability to solve problems related to the crypto community are a must for any project looking to be successful over the long term.

Recently, the advent of Layer 2 technology like Arbitrum, Optimism, and Bridging with the Avalanche ecosystem is revolutionizing the way investors, builders, and developers interact with different protocols, as each protocol enables fast, low-cost transactions that the Basics of DeFi. improve the ecosystem and make it easier for retail investors to seize the opportunity.

follow data From the token terminal, DeFi remains one of the fastest growing sectors of the crypto economy, as evidenced by the rise in Total Value Locked (TVL) across the protocols. Some of the biggest gains of the past week have been in cross-chain compatible networks and Layer 2 protocols, which offer a lower-cost environment.

Top 6 projects that add the most to the total locked value | Source: Token Terminal

Two of the top 6 projects in the list above, Trader Joe and Pangolin, discovered on the Avalanche Network, have seen significant cash flow and a surge in TVL (app) since the updated cross-chain bridge was launched to migrate into the Avalanche ecosystem.

Total value locked on avalanche | Source: Defi Lama

The governance functions are also a positive factor supporting new growth for projects as both Alchemix Finance and Rari Capital are ongoing or recently developed to improve their ecosystem and increase community participation.

The first on-chain proposal has just been carried out!

2,500,000 RGT were minted to support the DAO!

Thank you to the community for your input and vote.

Treasury address: https://t.co/YVSqAAN4nu

Transactions: https://t.co/EZRKSXT3jv

– Rari Capital DAO (@RariCapital) September 19, 2021

“First on-chain proposal just made! 2,500,000 RGT were minted to get the DAO! “

Layer 1 projects and leveraged exchanges Decentralization thrives

Another emerging trend is the growing power of options and derivatives trading protocols as regulators step up crackdown on centralized exchanges (CEXs) that provide derivatives services.

Top 6 projects to increase sales weekly |Source: Token Terminal

As shown above, two of the biggest revenue winners of the past week were dYdX and Hegic, protocols that allow investors to use decentralized derivatives and on-chain options trading.

Global regulators have stepped up scrutiny of leveraged and derivatives exchanges in recent months, and exchanges like Coinbase have signed up to offer futures trading services.

dYdX has also benefited from the fact that it works on a Layer 2 solution developed in collaboration with StarkWare, which enables permanent cross-margin without gas costs and minimal transaction fees.

The data also shows that Ethereum competitors like Tezos (XTZ) and Cosmos (ATOM) have seen increased revenue over the past week, suggesting that the battle for Layer-1 is intensifying as fees are high on the Ethereum network are exploring other options.

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