1inch (1INCH), saw a significant increase in volume and market dominance amidst a general market recovery in the last quarter of the previous year. According to a report by Messari, the popular decentralized exchange aggregator registered over $30 billion in trading volume throughout the quarter and held a 64% share in the Ethereum <a href="https://en.coin-turk.com/marinade-finance-blocks-users-from-the-united-kingdom-due-to-compliance-concerns/”>DEX aggregator market. The near doubling of volume from external sources indicates an increase in adoption of 1inch as a backend solution and expansion of aggregator platforms.
1inch’s Trading Activity Increases in Q4 2023
Although the growth in transactions on 1inch is mainly associated with new products, as indicated by the increased activity in the Limit Order Protocol (LOP) and 1inch Fusion, transactions in the aggregation protocol decreased during the quarter. The share of 1inch transactions on Uniswap V3 and V2 increased by 8 and 3 points, respectively, accounting for 40% of the transactions and 8% of the trading volume. According to Messari’s report, the volume generated on these two Uniswap (UNI) versions on 1inch rose from $5.6 billion in the third quarter to $10 billion in the fourth quarter.
This share was primarily obtained from Curve (CRV) and Dodo (DODO), which are the second and currently the sixth most common application venues. PancakeSwap (CAKE) continued to receive over $1 billion in trading volume from 1inch for the second consecutive quarter, making up 7% of 1inch’s total volume in the fourth quarter.
Throughout the period, 1inch saw a notable increase in volume compared to its peers, executing 59% of the transactions in the third quarter and increasing its market share to 63% in the fourth quarter. The only significant competitor to gain market share in the fourth quarter was CoW Swap, which held 11% of the aggregator volume on Ethereum (ETH) throughout the quarter. ParaSwap and 0x held 11% and 10% of the aggregator volume, respectively, in the fourth quarter.
1Inch DAO and Strategic Treasury Management
During the fourth quarter, the 1Inch DAO effectively continued its strategic treasury management, swapping one million USD Coin (USDC) for Dai (DAI) to diversify its stablecoin assets. These funds were then invested to earn interest as sDAI, marking the first reallocation since depositing one million USDC for interest in Aave (AAVE) in the second quarter.
On the expenditure front, the 1Inch DAO utilized just over one million dollars in three different transactions. Notably, on December 30, 2023, 890,000 USDC were allocated to finance support services for users within 1inch. On the other hand, there was a 7% increase in the amount of 1INCH staked during the fourth quarter.
This recovery on the 1inch front as a DEX aggregator has led to increased expectations that the quiet period for the protocol’s native asset, 1INCH, may soon be disrupted, potentially leading to a price rise. At the time of writing, the altcoin’s price has seen a 0.12% decrease in the last 24 hours, trading at $0.4786.
