IDEX is the first Ethereum based decentralized smart contract exchange to support real-time trading and high transaction throughput. It claims to be one of the most advanced Ethereum decentralized exchanges (DEX). Supporting limit and market orders, gas-free cancels, and the ability to fill many trades at once.
However, unlike other decentralized exchanges. The IDEX smart contract is designed in such a way that only the exchange is authorized to submit signed trades to Ethereum. This enables IDEX to control the order in which transactions are processed. Separating the act of trading from the final settlement.
According to the DappRadar OpenData tracking of IDEX, trading volume surged tremendously in May. It is important to look deeper into what is causing such volatility and why.
Key takeaways
- IDEX recently became the 2nd position DEX on DappRadar Open Data by trading volume, reaching 114M USD in the last 30 days
- In May 2020 trading volume grew by 263% if compared to April 2020
- The main tokens were UBT and ESH which fueled IDEX trading volumes by 50M USD with an increase of 409%
- Different from other TOP DEXs the majority of traded tokens were utility tokens, not stablecoins
What just happened?
When observing the first four months of 2020, trading volume on IDEX grew on average by 10% month-on-month. Some peak days could be spotted which is quite common for DEXs in general.
While looking at May of 2020, we witness a tremendous increase which led to IDEX securing second place in the TOP DEXs. The peaks could be explained by a few tokens that drove increased volume in May by 50M USD.
Top 5 trading pairs on IDEX right now
The most-traded coins on IDEX across May 2020 so far are UBT, ESH, and QNT. All of them are utility tokens. The TOP 5 trading pairs on IDEX contribute 51% of the total trading volume.
UBT
UBT is basically an ERC-20 utility token that served as a voucher for the Unibright products and consulting services. Unibright itself is a blockchain solution provider that enables enterprise blockchain integration, tokenization, and more. In other words, Unibright helps the existing centralized IT system providers or companies to develop and adopt smart contracts.
Since the beginning of the year 2020, the UBT token price surged by 2678%, from 0.018 USD to 0.5 USD. The price has increased mostly due to a few factors.
First of all, Unbright is participating in the Baseline Protocol creation alongside well-known companies like Microsoft and Ernst & Young. This appears to be fuelling speculation of an increasing token price which has brought popularity to the token itself. Secondly, listing on well-known exchanges like Bittrex.
The UBT token is responsible for almost 30% of the total trading volume on IDEX and is the most traded token right now.
ESH
ESH token is another ERC-20 token issued by the Switch exchange. Switch describes itself as a token exchange that aims to give users the ability to seamlessly “switch” between other assets, buy gift cards, donate to non-profits, and gamble.
Switch tokens (ESH) represent a revenue share of 50% of all fees collected by Switch and SwitchDex.ag, which is airdropped to Switch (ESH) token holders every month.
Some significant events impacted the price of the token in mid-May: Airdrops of the Ghost token where ESH holding has required and listing on Bitcoin.com resulted in ESH’s price reaching almost 2 USD (from 0.01 USD).
ESH represents 21% of the total trading volume for IDEX in May but despite the recent growth in trading volume for the pair ETH/ESH it is expected to be temporary, and decrease by next month. We will continue tracking the token and report any further developments.
Conclusion
IDEX is not a common DEX as the majority of the trading occurs within utility tokens. Events surrounding the main two tokens occurred during May which appears to have spiked users’ interest into the tokens. In May UBT and ESH, tokens have already generated 50M USD.
UBT is behind an organization called Unibright which is closely working with the Baseline Protocol project. Alongside well-known companies like AMD, Microsoft, Ernst & Young, and similar. In the event of the release of such a project, the demand for the token and the price could spike even more.
While for the ESH token, the increase seems to be caused through genuine momentum. We expect to view a fallback and for the token to settle closer to its starting price.
We will continue watching this space. Make sure you bookmark DappRadar and sign up to our newsletter below to get updates direct to your inbox.
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