Each day, Coinrule will run through the state of the digital assets market for Blockbeat, your home for news, analysis, opinion and commentary on blockchain and digital assets.
Last cycle, all eyes were on the centralised exchange Binance. Law enforcement agencies had yet to launch any attacks and its founder, Changpeng Zhao, was also still at the helm. But, even after its battles with regulators, according to The Block’s data, the exchange still maintains over 40% spot trading volume dominance. However, its own chain, Binance Smart Chain, is quickly losing its dominance.
Binance’s Smart Chain (BSC), erupted with users in 2021. It was a big on-chain onboarding event through its low gas fees, when at the time Ethereum’s high fees were making retail trading inaccessible. According to The Block, over 85% of all new tokens launched on BSC in the second half of 2021. DefiLlama’s data states, in May 2021, BSC trading volumes surged to over $140 billion eclipsing Ethereum’s $117 billion.
Today, BSC is still a serious contender coming third highest, with over $47 billion in trading volume in March. However, the landscape has changed, with Ethereum and Solana now consistently surpassing it in trading volumes. Coinbase has now also entered the on-chain arena with its own Layer-2, Base. Base is now the chain pumping out the most tokens. Following its fees decreasing due to Ethereum’s Dencun upgrade, it is now responsible for over 55% of new tokens and March’s seventh highest chain volume with nearly $8 billion. Its total value locked has also grown by over 110% over the past month to nearly $1.5 billion.
Now, however, there may be a new player in the mix. On Monday, the centralised exchange, OKX, launched their own Zero Knowledge Layer-2 built using Polygon’s Chain Development Kit (CDK). OKX was also the second most traded on centralised exchange during March, according to The Block. X Layer, as it is known, integrates with OKX’s exchange and its Web3 wallet to provide seamless on-chain access to its 50 million users. It already supports 30 live applications and has an additional 170 in the testnet. X Layer will also connect with Polygon CDK’s AggLayer, enhancing its liquidity by linking to other chains that connect to it as well.
Layer X will also use OKX’s own token, OKB, to settle gas fees. This new utility for the token may also see its demand increasing. In turn, OKB’s appreciation could increase OKX’s war chest. These funds could be used to give out developer grants and incentives, enticing more developers to build applications on X Layer. Could Layer X be a new competitor in the centralised exchange quest for on-chain supremacy?
