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Part
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Blockchain Developer Tools and the DEX Market
Key Takeaways
- A competitive landscape of the top 25 decentralized exchanges by market share has been presented in the DEX Market Overview spreadsheet.
- Some of the most popular blockchain developer tools for each of the assigned blockchains have been described in the Blockchain Developer Tools spreadsheet.
- Mdex was launched in January 2021, and it quickly became the dominant DEX by market share due to its extremely low cost and high speed. Mdex currently exists on three different blockchains: Ethereum, Binance Smart Chain, and HECO. It issues out rewards in its native MDX token through liquidity and transaction mining. The platform has already issued about $280 million in transaction mining rewards and $200 million in liquidity mining incentives.
- The Ethereum blockchain has the most diverse ecosystem of developer tools available out of all blockchains, likely because of its first-mover advantage. In fact, developer tools for Ethereum are often the most popular developer tools on other blockchains that can integrate with Ethereum (like Binance Smart Chain) through the Ethereum Virtual Machine (EVM).
Introduction
A competitive landscape of the top 25 decentralized exchanges by market share has been presented in the DEX Market Overview spreadsheet. In total, 28 exchanges have been listed in the spreadsheet. However, three of the exchanges are basically different versions of the same exchange running on different blockchains, and they warrant inclusion due to their significant trading volume. 25 unique DEXes have been listed in the spreadsheet.
Notes on the reasons for the inclusion or exclusion of certain exchanges are presented below. The market share was calculated based on the 24-hour trading volume on June 9, however, the trading volume, and the corresponding market share can change rapidly.
Some of the most popular blockchain developer tools for each of the assigned blockchains have been described in the Blockchain Developer Tools spreadsheet. Notes and some images uncovered during research related to these tools are presented in the Blockchain Developer Tools section below.
Decentralized Exchanges
The daily trading volume has been sourced on June 9 from CoinGecko, unless an exchange was only listed on CoinMarketCap. The market share was calculated by dividing that volume with the total trading volume on all decentralized exchanges, as reported by CoinGecko.
CoinGecko was the primary source for the number of listed coins and the number of trading pairs as well, unless the exchange was only listed on CoinMarketCap. In that case, the coins and trading pairs were counted manually.
The token of the exchange's native blockchain, as reported by CoinMarketCap, has most often been used as the base token. If an exchange does not have a native blockchain, the most commonly used trading pair (often a stablecoin) was noted instead.
All decentralized exchanges run on blockchains via smart contract applications, and settle transactions on their underlying blockchains. Therefore, the average time to place orders and the average settlement time are always the same, and they are equivalent to the time it takes the underlying blockchain (Layer 1 solution) to produce a new block, sometimes referred to as "block time".
Most of the listed decentralized exchanges have very similar features, and therefore lack any unique competitive advantages. In fact, most exchanges are direct copies (forks) of the source code of one another (a lot of exchanges are direct copies of Uniswap, which is one of the first decentralized exchanges to gain mass adoption). Frequently, the only differentiating factor between these exchanges is the underlying blockchain that they use to settle transactions. Therefore, exchange descriptions were often copied directly from CoinMarketCap.
Growth was very hard to quantify, and was unavailable for most decentralized exchanges. This is likely because a significant number of these exchanges are relatively new, and smart contracts related to them have not been flagged and tracked yet. For those exchanges for which growth has been reported in column O, it was sourced from DappRadar's metric of the change in the number of users over the past 30 days. Since these are pseudonymous decentralized exchanges, DappRadar defines the number of users as the "number of unique wallet addresses interacting with dapp's smart contracts". Even for those exchanges, sometimes the growth divers were not known, and the growth can likely be attributed to the overall rise of the DEX market.
Inclusion Reasons
- Bancor Network — Bancor Network has been included in the top list, even though it only appears among the top exchanges on CoinMarketCap. On CoinGecko, the exchange’s reported trading volume is $0, however, this is most likely due to a data error (CoinGecko reports a price of $0 for most trading pairs on Bancor, even though they actually have a positive price).
- KLAYswap — KLAYswap has been included in the top list, even though CoinGecko doesn’t classify the token as a DEX. CoinMarketCap does classify it as an exchange, and an analysis of KLAYswap’s website confirms it is indeed a decentralized exchange.
- WaultSwap, ApeSwap and ParaSwap — WaultSwap, ApeSwap and ParaSwap have been included in the top list, even though they are only listed on CoinGecko. CoinMarketCap features these exchanges only as “untracked listings”, but the exchanges seem to be fully operational.
Exclusion Reasons
- BurgerSwap — BurgerSwap has been excluded from the analysis, even though it appears to have significant trading volume on CoinMarketCap, because the exchange has a total trading volume of $0 on CoinGecko. Upon further analysis, the volume data (and other trading data) for BurgerSwap on CoinMarketCap has been last updated more than a month ago.
- 1inch — 1inch Liquidity Protocol has been excluded from the analysis because it is only a part of the 1inch DEX solution, even though it is reported as a separate exchange by CoinMarketCap and CoinGecko. This is not a new version of the exchange (like in the case of Uniswap for example). Instead, it is a protocol for providing liquidity to the 1inch DEX, and is meant to run alongside the 1inch Exchange.
- Perpetual Protocol — Perpetual Protocol has been excluded because it is not a decentralized exchange in the narrow sense of the word. CoinMarketCap and CoinGecko classify the project as a DEX. However, Perpetual Protocol offers decentralized perpetual contract (futures) trading on cryptocurrencies. While it allows users to gain exposure to the price of various cryptocurrency assets, it is not a protocol for exchanging those assets.
- PancakeSwap — PancakeSwap (V1) has been excluded as it is very similar to PancakeSwap (V2) and it seems like most of the trading volume has migrated to V2. CoinGecko reports a significantly lower volume for V1 than CoinMarketCap, which is another reason for exclusion.
- Compound Finance — Even though Compound Finance ranks as the 12th top DEX on CoinGecko, it is classified as a yield farming protocol on CoinMarketCap. Compound Finance does in fact allow users to exchange cryptocurrencies, but only for the purpose of later using them as collateral on Compound's decentralized finance blockchain. It is not primarily used as a decentralized exchange.
- Sushiswap — Sushiswap (Polygon POS) has been excluded from the list because it only appears on CoinGecko. It seems that CoinMarketCap groups the volume of Sushiswap on all chains, including the Polygon POS chain.
Blockchain Developer Tools
Methodology
The number of users is an unreliable metric for determining the top developer tools for a certain blockchain, as some tools are more geared towards developers only, while other tools are useful for consumers and the general public. This, along with the fact that most blockchain developer tools do not report the number of users, makes ranking developer tools using quantitative metrics unfeasible. Instead, the tools presented in the attached spreadsheet have been identified by referencing multiple articles and third-party top lists for each blockchain. The types of users and the stage of development for each tool are based on a subjective assessment of the tool's features and development timeline.
Bitcoin
- Unlike most other blockchains, Bitcoin does not offer support for complex smart contracts needed to build decentralized applications. Therefore, most of its development is based on low-level C++ programming. While there are various developer tools available for Bitcoin, most have very niche applications and are used by only a small minority of developers. The only somewhat popular Bitcoin developer tool is the Bitcoin software development kit — the Bitcoin Dev Kit.
Ethereum
- There are a variety of developer tools available for Ethereum. Five of the most popular ones have been listed in the attached spreadsheet, and some images related to these top tools that have been identified during research are presented below.
MetaMask
Geth
Binance Smart Chain
- The Binance Smart Chain is fully compatible with the Ethereum Virtual Machine (EVM). While there is a limited number of tools available for Binance Smart Chain specifically, developer tools that have been created for Ethereum are far more popular on the Binance Smart Chain as well. For example, while many of the decentralized exchanges presented above have versions running on Binance Smart Chain, most require users to use MetaMask instead of the Binance Chain Wallet to access them.
XRP Ledger
- XRP Ledger is an open blockchain maintained by the XRP Ledger Project and supported by Ripple, a cryptocurrency company, through its Ripple X Platform. While some tools are created by RippleX, or the XRP Ledger project, other tools are created by the community. Two of the most popular (based on the number of GitHub contributors) open-source developer tools for the XRP Ledger available on GitHub are presented in the attached spreadsheet. Additional popular tools include different versions of the RippleX Dev Kit for different programming languages, and have not been included in the list.
Cardano
- The mainnet of Cardano still does not support smart contracts, which means it does not support decentralized applications. Cardano's "Alonzo" upgrade is expected to bring smart contract functionality to the blockchain by the end of August. Cardano supports Ethereum Virtual Machine (EVM) integration through KEVM, so Ethereum developer tools will likely be the most popular developer tools for Cardano once the Alonzo upgrade is completed.
Polkadot
- Polkadot is a compartmentalized blockchain (built out of many sub-chains), which is why its developer tools are more oriented toward core blockchain functionality instead of decentralized applications. Some Polkadot applications (built using Polkadot core tools) are actually smart contract development platforms for Polkadot. Three core development tools for Polkadot are presented in the attached spreadsheet, followed by two smart contract platforms for developing decentralized applications on Polkadot.
Stellar
- There are no true developer tools for Stellar as the blockchain is mostly intended to handle fast transfers of large asset values, and only includes the most low-level (and therefore most secure) smart contract capabilities. Developers build apps on Stellar by using a software development kit (SDK) in their preferred language and connecting it with Horizon, Stellar's API that acts as a bridge to the Stellar blockchain. Horizon, and the two most popular SDKs (by GitHub contributors) are presented in the attached spreadsheet.
VeChain
- Since VeChain is an organization focusing on enterprise blockchain application, it does not necessarily encourage third-party development for its ecosystem. In fact, it offers different solutions for enterprises in various industries that want to solve real-world problems with blockchain technology.
- VeChain offers Sync, a web browser and mobile wallet that allows users to trade tokens on Vexchange, manage nodes, vote on governance issues, and store funds. It even allows for the deployment of smart contracts written in Solidity, although the functionality is very basic.
- Finally, "VeChain's Blockchain-as-a-Service (""BaaS"") platform is called ToolChain. ToolChain is a comprehensive blockchain platform offering diverse services including: product lifecycle management, supply chain process control, data deposit, data certification, and process certification." While ToolChain offers some developer tools for enterprises, they are only accessible to VeChain's clients.
Cosmos
- Cosmos has a diverse suite of developer tools, and four of the most popular tools have been presented in the attached spreadsheet.
Solana
- Developer tools for the Solana blockchain still do not exist. Solana offers the Solana CLI (command-line interface) and the Solana Tool Suite, which are basic low-level tools for interacting with the Solana blockchain.
- Since Solana is built in the Rust programming language and is not compatible with the Ethereum Virtual Machine, additional developer tools for Solana are expected to be created as the blockchain gains popularity.
Research Strategy
The decentralized exchanges have been ranked by market share in the spreadsheet. The market share was calculated by dividing the 24-hour trading volume on each exchange (most often used CoinGecko as a source) with the total trading volume on all decentralized exchanges, as reported by CoinGecko. The market share was calculated based on the 24-hour trading volume on June 9, however, the trading volume, and the corresponding market share can change rapidly.
Most of the listed decentralized exchanges have very similar features, and therefore lack any unique competitive advantages. In fact, most exchanges are direct copies (forks) of the source code of one another (a lot of exchanges are direct copies of Uniswap, which is one of the first decentralized exchanges to gain mass adoption). Frequently, the only differentiating factor between these exchanges is the underlying blockchain that they use to settle transactions. Therefore, exchange descriptions were often copied directly from CoinMarketCap.
Growth was very hard to quantify, and was unavailable for most decentralized exchanges. This is likely because a significant number of these exchanges are relatively new, and smart contracts related to them have not been flagged and tracked yet. For those exchanges for which growth has been reported in column O, it was sourced from DappRadar's metric of the change in the number of users over the past 30 days. Since these are pseudonymous decentralized exchanges, DappRadar defines the number of users as the "number of unique wallet addresses interacting with dapp's smart contracts". Even for those exchanges, sometimes the growth divers were not known, and the growth can likely be attributed to the overall rise of the DEX market.
The number of users is an unreliable metric for determining the top developer tools for a certain blockchain, as some tools are more geared towards developers only, while other tools are useful for consumers and the general public. This, along with the fact that most blockchain developer tools do not report the number of users, makes ranking developer tools using quantitative metrics unfeasible.