The decentralized exchange (DEX), Chronos, set a new milestone on May 4, reaching $217 million in total value locked (TVL) at press time, just seven days after its launch on the Arbitrum blockchain.
With the new TVL figures, Chronos ranks eighth among the largest decentralized exchanges, according to DefiLlama. In DeFi, the total value locked represents the funds held or locked within a protocol.
The TVL milestone was reached during the early hours of the day after the protocol started Epoch 1, which allowed Chronos (CHR) token issuances to liquidity pools. The start of Epoch 1 also allowed stakers to start collecting rewards.
Chronos debuted on April 27 as a liquidity provider and automated market maker for the Arbitrum network, hosting core pools such as Chronos-Ether (CHR/ETH) and Chronos-USD Coin (CHR/USDC), both seeded with 2 million tokens. CHR, along with the Arbitrum-Ether (ARB/ETH), Ether-USD Coin (ETH/USDC), USD Coin-Tether (USDC/USDT) and Wrapped Bitcoin-Ether (WBTC/ETH) pools.
Decentralized exchanges are at the heart of DeFi and are showing signs of growth and maturity following the 2022 bear market. “After the FTX bankruptcy, the sector saw the real value of DEXs. The decentralization that DEXs bring matters more than ever,” said Charles Wayn, co-founder of community platform Web3 Galxe, explaining that DEXs and wallets will be the backbones of gaming adoption for years to come.
Likewise, Maverick Protocol CTO Bob Baxley told Cointelegraph that the past year has served as a proof of concept for DEXs and DeFi. “After all, if you look at some of the major DEXs, on some days they are moving more volume than Coinbase,” he said, noting that the tightening of the regulatory environment in the United States is likely to benefit DEXs:
“If centralized on-ramps to the crypto ecosystem continue to be cut off in places like the United States, then we could see more and more people turning to DEXs to conduct their trades.”
DEXs are peer-to-peer markets where traders transact without handing over their funds to intermediaries or custodians. Smart contracts handle these self-executing transactions. However, as we have seen in recent years, hacks and bugs are among the biggest risks of trading a DEX.
“I suspect that volumes for a wide variety of DEXs will eventually grow at an exponential rate, especially as the underlying blockchains like Ethereum continue to scale and, in turn, offer more yield for lower gas prices,” Brent Xu, founder of the Web3 bond market platform, told Cointelegraph; Umee.
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