Uniswap | PancakeSwap | Raydium | Let's F***ing Joe (Trader Joe)

• While decentralized exchange (DEX) volumes has decreased since the peak of 2024, they are still hovering around $20 to $25B per week, 100% year-over-year. Solana and Base account for a significant amount of trading, as Solana volumes have increased more than 20x, from $170M to $4B. The only chain to decrease is Ethereum, losing about 20% of its weekly trading volume.

• DEX trading is much more competitive than one year ago, when Ethereum accounted for almost 60% of trading volume. Five chains now account for over 10% trading share. Ethereum is still the largest at 29%. Base has gained significant market share throughout 2024 and now account's for over 12% of DEX volume across all chains.

• Trading venues have also undergone significant shift. Uniswap trading share has decreased from 53% to 33% as established DEXs like the Solana-based Orca have gained market share while new exchanges Aerodrome have also increased in popularity.

• One of the most compelling aspects of Uniswap is that it allows liquidity providers—users who deposit assets for traders to use—to generate revenue. The chart below shows fees collected by V3 pools over the last 12 months. USDC-WETH leads and has generated over $4B for liquidity providers (LPs). Uniswap V3 offers multiple fee tiers to charge traders—0.01%, 0.05%, 0.3%, and 1%—to offer optionality to both LPs and traders — similar assets, like stablecoins, typically charge lower fees. These tiered fees allow LPs to optimize their returns based on assets' volatility and trading activity.

• Among Uniswap V2 pools, the WETH-USDT pool leads in fee collection, surpassing $1B, followed closely by USDC-WETH and PEPE-WETH pairs. Despite V2's simplicity, V3's concentrated liquidity feature attracts greater volumes due to greater capital efficiency for LPs and lower fees for users.

• Despite Uniswap's substantial fee generation for LPs, $UNI is purely a governance token and lacks mechanisms like token burns that could potentially increase its value. 60% of UNI was distributed to the community in 2021. This $UNI HOLD Wave chart shows some interesting patterns.

• PancakeSwap is a DEX originated on BSC which now operates on multiple chains — the DEX issues the $CAKE token as a reward for LPs. In 2023 PancakeSwap adopted a deflationary model for their tokenomics. This was achieved through emission reductions and mechanisms to recover $CAKE from the market. Their efforts quickly paid off as CAKE supply peaked in August 2023 at a supply of 391.3M. Since then supply has decreased steadily reducing by 7.8M tokens in a year.

• To achieve this deflation, Pancakeswap operates weekly burns by sending CAKE to a burn wallet on BNB Chain. On average they burn 9M a week as defined by their tokenomics. Emission reductions and collection from market offset the quantity minted.

• Deflation depends on market factors like trading volume and CAKE price. Over time variations of the deflation rate ranged between 1.4 and 0.2 CAKE per block. With the current tokenomics a weekly supply decrease involves recovering 275K CAKE from the market. This challenge is achieved nearly every week.

• Raydium is the leading DEX on Solana by market share and pool creation. Since Jan. 1 2024, more than $35M in protocol fees has been allocated towards programmatic buybacks of the $RAY token. Raydium has averaged 30-50% of the cumulative spot market volume on Solana throughout the year. Raydium has facilitated nearly $270B in volume with LPs earning more than $630M in swap fees since inception.

• When accounting for organic volume—with bots removed—Raydium's swap routing program shines and currently accounts for more than 30% of all organic taker flow, second only to Jupiter.

• Despite being one of the main benefactors of the booming memecoin volumes on Solana, currently, only 11.4% of Raydium's total volume comes from memecoins.

• LFJ (formerly Trader Joe) is an onchain marketplace for token exchange, the platform launched in July 2021 and has since gone on to facilitate over $130B in lifetime cumulative trading volume. In 2024 alone, LFJ added over $30B in volume, doubling the amount from the previous year. This growth has been largely driven by the increased activity on the Avalanche network, where LFJ holds a dominant position.

• LFJ shares 5%-25% of trading fees with $JOE token stakers, distributing an average of $550k in stablecoins monthly in 2024. That's up 109% from last year. With 80% of revenue from Avalanche, increased activity on the chain brings significant value to JOE stakers.

• The $JOE token has reached its mint cap of 500M, with a circulating supply of currently ~380M. With no fixed incentive schedule, JOE is rarely used for liquidity rewards. So far over 2024, under $100K has been distributed to yield farmers, while maintaining a positive earnings position of over $5M.