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Traders Flock to Decentralized Exchanges Amid US Crypto Crackdown

2 mins
Updated by Ryan Boltman
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In Brief

  • Uniswap beats Coinbase's March trading volume by over 45%.
  • The decentralized exchange crossed over $70 billion in trading volume.
  • The users of decentralized exchanges hit 1 million in Q1 2023.
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Decentralized exchange Uniswap flips trading volume of Coinbase in March. Is it due to the crypto clampdown by the US government?

According to data from DefiLlama, Uniswap crossed over $70 billion in trading volume in March. As seen in the chart below, the volume on Uniswap has been rising month-on-month since Dec. 2022.

The trading volume on Uniswap has seen these levels for the first time since Jan. 2022.

Uniswap monthly trading volume
Source: DefiLlama

Uniswap Flips Coinbase Trading Volume 

Coinbase witnessed a 23% higher trading volume in Mar. compared to February. According to The Block, last month’s trading volume was $49.4 billion, whereas, in Feb., it was $40 billion.

Despite Coinbase’s progress in March, Uniswap has surpassed the trading volume by over 45%.

Coinbase trading volume
Source: Coinbase

Users Flocking to Decentralized Exchanges?

After the FTX collapse in Nov. 2022, investors’ sentiment turned negative for centralized exchanges. Hence the users flocked towards self-custody solutions and decentralized exchanges.

Apart from investors’ sentiment, the failure of FTX also triggered a strict clampdown on crypto businesses from the US government in 2023. Firstly, the US Securities and Exchange Commission (SEC) fined Kraken exchange $30 million for offering staking services in Feb.

Then on Mar. 23, the SEC served Coinbase with a Wells Notice. And the Commodity Futures Trading Commission (CFTC) sued Binance for breaking trading and derivative rules, resulting in withdrawals of $1.6 billion.

Lastly, the SEC shut down the crypto exchange Beaxy’s operations on Mar. 29 with immediate effect.

Due to the regulators’ actions against centralized exchanges, the users are heading towards decentralized platforms. According to a Dune dashboard, decentralized exchanges hit 1 million users in 2023 Q1. 

Decentralized exchange hit 1 million users in Q1 2023 due to the US crypto clampdown.
Source: Dune

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Harsh Notariya
Harsh Notariya is a journalist at BeInCrypto, who writes about various topics, including decentralized physical infrastructure networks (DePIN), tokenization, crypto airdrops, decentralized finance (DeFi), meme coins, and altcoins. Before joining BeInCrypto, he was a community consultant at Totality Corp, specializing in the metaverse and non-fungible tokens (NFTs). Additionally, Harsh was a blockchain content writer and researcher at Financial Funda, where he created educational reports on...
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