SushiSwap, regardless of one’s personal opinion about it, has seen a massive boost thanks to its merger with the Yearn ecosystem. As a result of this massive headway, the exchange has started to eat at the market share of Uniswap, the leading decentralized exchange SushiSwap originally forked from.
A New Age For SushiSwap
Mira Christanto stands as a researcher at Messari, and tweeted on the 29th of January, 2021, with data that showed that the Automated Market Maker sector saw a decline in Uniswap’s share. At the same time, SushiSwap had seen an increase in its share, growing from mid-December up until last week.
@UniswapProtocol isn't going to take this lying down. AMMs are the most competitive areas of DeFi. *Both* are growing rapidly & coming out with new innovations.@SushiSwap needs to deliver on high expectations and $UNI holders are waiting for Uniswap V3.
— Mira Christanto (@asiahodl) January 28, 2021
According to Christanto, the Yearn merger provided a newfound sense of legitimacy for the SushiSwap protocol. As a result, the project was capable of somewhat pushing past the criticisms leveled against it since its launch back in August as essentially a clone of Uniswap. Further accusations revolve around how it secured its Total Value Locked (TVL), doing so through so-called “vampire” liquidity attacks.
A Very Dubious Past
SushiSwap took another chunk out of Uniswap back in November, as well, when the exchange introduced yield farming rewards. These rewards were for pairings that had been incentivized by UniSwap previously.
According to Christanto, it’s claimed that SushiSwap has officially put its dubious past behind it. The platform itself currently boasts weekly volumes and liquidity anywhere between $2 billion and $2.5 billion. Christanto stated that Sushi has no backing from venture capital firms, claiming it’s quick on innovation. They highlighted how SushiSwap has evolved to include franchised liquidity pools, lending, as well as a launchpad and cross-chain integrations.
It seems, however, that Uniswap is still maintaining dominance even with the newfound success of SushiSwap. It still accounts for over 60% of all unique addresses within the DeFi space.
Some Number Crunching
Sushi is no joke, however, boasting a TVL of $2.07 billion, which is almost two-thirds that of Uniswap ($3.18 billion). The interesting thing, however, is that the user bases say a whole other story. Focusing on just that, Sushi boasts a meager 8% of the total user base of Uniswap. Uniswap had a clear advantage in this front, however, having gained 225,000 users before Sushi had even launched.
Time will tell if Sushi can manage to hack out its own niche after originating as one of the many vampire exchanges the world has given as of late, but luckily the consumers will gain out of this rivalry.