The cryptocurrency market seems to be growing daily. Just last week, the market is recorded to have exceeded $2 trillion. While the top currencies, Bitcoin and Ethereum, led the way, other currencies are making it to the top as well. 

A recent analysis has shown a tremendous increase in terms of market demand with DeFi. Several metrics were considered to try to decipher the reason for the surge in market demands. The five indicators showing that DeFi is currently at its highest point in demand are explained in the following section:

The Total Value Locked

The total value locked refers to the amount of supply protected by DeFi projects. This serves as an indicator for measuring demand. As the value of the cryptocurrency market increased, so did the DeFi projects. In the world of blockchain and cryptocurrency, the DeFi projects have reached a point of $43.15 billion in terms of total value locked. 

This has resulted in a surprising 200% increase from the point it started off at the beginning of 2021. The most common lending projects, Maker, AAVE, and Compound, allow stakers to earn a reasonable amount of interest from investing. 

Gas Fees on the Ethereum Network

The Ethereum network has long had a downside fueled by its characteristics, such as high fees around exchanges. Recently the fees on transactions on the Ethereum space rose to an amount of $40. This is expected to influence market decisions. 

The high transaction fees have led to a higher bid compared to previous bids for the continuous mining of decentralized exchanges. Top Ethereum based decentralized exchanges, Uniswap and Sushi swap, have also arrived at a point of $100 per transaction. Now, from analysis, it is easy to understand why this has contributed to the increase in demand. 

An Increasing Number Of Decentralized Exchanges

The DeFi platforms are benefitting by offering relatively lower fees, and more decentralized exchanges are being created. This is in line with market emotions regarding Ethereum gas fees. 

Decentralized Transactions are also High

Based on recent data, DEX transactions were recorded to be under 50 million. However, the numbers skyrocketed to the point of 800,000 a week ago. Uniswap v2, IDEX, and Ether Delta have ranked top three, with Uniswap v2 ranking first, taking 64% of the market, then IDEX as second, and Ether Delta as the third. 

DeFi Tokens Are At Their Highest Point Ever

DeFi’s AAVE rose to $500 just a month ago from its $53 point, which it had in November 2020. Based on all of this, it is easy to understand why DeFi has risen greatly in demand.