Weekly Onchain Insights: Uniswap’s Liquidity Mining End
By: Into The Block
Tags: Cryptocurrency, Crypto, Bitcoin, Ethereum, Defi

Weekly Onchain Insights: Uniswap’s Liquidity Mining End

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Hey onchainers,

Welcome back to IntoTheBlock’s newsletter. We have created a different type of newsletter for crypto fans that is not about news, but about data and analytics. Every week, we deliver valuable data insights about the crypto market.

Bitcoin Analysis: $18,207.11 (5:00am EST)

Bitcoin has been unstoppable the last few weeks. The first cryptocurrency has appreciated by approximately 80% since September with its market capitalization reaching new highs as its price surpasses $18,000.

At the moment of writing, Bitcoin price is sitting at $18,207.11 and the In/Out of the Money Around Price (IOMAP) indicator reveals that there isn’t much resistance ahead that would allow BTC to continue climbing towards $19,310. The next level of resistance is located between $18,210 and $18,422, where 380 addresses previously bought 784 BTC.

Looking at the levels of support, $17,800 is holding strong, as approximately 449 thousand addresses previously bought 465 thousand BTC. This is expected to act as support as holders in this range will attempt to remain profitable on their positions and push prices above this level.

By comparing these levels to those provided by technical analysis, we can verify buyers are expected to create strong support near the $17,800 range. The strength of these price ranges, as demonstrated by the magnitude in volume of these clusters, points to the possibility of Bitcoin going higher with much resistance towards its all-time high

See the Bitcoin In/Out of the Money

This Week Analysis: Uniswap’s Liquidity Mining End Welcome by Competing DEXes

The largest decentralized exchange (DEX) Uniswap recently finalized its liquidity mining rewards. For two months, liquidity providers had been receiving rewards with the UNI native token for supplying liquidity to the protocol. Since the UNI incentive came to an end, Uniswap’s liquidity dropped by approximately 58%.

Uniswap’s competition, as shown in the right graph, benefitted from the expiration in UNI rewards, with value locked in other DEXes climbing quickly. Specifically, SushiSwap has been the biggest benefactor, with its liquidity increasing by 200% relative to a month ago. Meanwhile, Bancor, Balancer and Curve saw monthly increases of 127%, 15% and 2%, respectively. The sudden shift in liquidity highlights the yield-seeking fickle nature of the DeFi space.

While Uniswap continues to have higher liquidity overall than SushiSwap, the latter has dethroned the former with the most liquid trading pair out of all DEXes. At the time of writing, the USDC-ETH pair in SushiSwap has the highest liquidity (right chart below).

The chart above also shows that as liquidity providers quickly reallocate capital based on expected yields, traders switched as well. The top five most traded pairs across DEXes are now shared between Uniswap and Sushiswap, even for the less-liquid USDC-ETH pair.

Despite the crash in liquidity in Uniswap, UNI’s price continued to grow. Along with this, UNI has seen an increasing number of holders even after the liquidity mining rewards came to an end.

The growth in holders point to the strong community and belief Uniswap has fostered, despite the drop in the protocol’s liquidity. Overall, liquidity mining has been shown to boost short-term metrics for Uniswap, but may have also pushed longer-term adoption from traders and holders.

IntoTheBlock Webinars:

A Data-First Perspective of Crypto vs. Capital Markets. Limited to 100 seats (Free registration)

Bitcoin has outperformed traditional markets in 2020. This trend has been propelled by growth in key on-chain metrics and adoption from major institutional players. Along with it, the rest of crypto has appreciated remarkably as crypto markets reach back towards 2017 highs.

In this webinar we will analyze the data backing the outstanding performance of crypto relative to capital markets in 2020. As well, we will dive into emerging patterns between the two, and where the relationship between crypto and traditional markets may head in 2021 and beyond.

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