GM, this is Milk Road PRO, your personal nerds-for-hire, here to guide you through crypto!
The market is always full of noise—it never stops.
The key is figuring out what’s just background buzz and what actually matters.
And right now, there’s one big trend that most people are still missing.
The chart below compares trading volumes on centralized exchanges (CEXs) like Coinbase and Binance with decentralized exchanges (DEXs) like Uniswap and Aerodrome.
Recently, we hit a new all-time high of 20%—meaning a growing share of trading is happening on decentralized exchanges. Yes, centralized exchanges still handle most of the volume, but this shift is worth paying attention to.
But why does this matter? Well, we all heard about Coinbase’s Q4 trading volumes.
Coinbase hit $439 billion in trading volume in Q4 last year—a massive 185% increase from the year before. That’s the kind of growth investors love to see.
But Coinbase wasn’t the only one making waves. Robinhood hit record highs in Q4 last year, adding even more momentum to the market.
Robinhood saw $71 billion in trading volume in Q4, growing at an even faster pace—up 454% year-over-year.
Triple-digit growth is almost unheard of in traditional markets, making it a magnet for attention and interest.
This makes one thing clear—crypto trading volumes are booming across the board.
👉 But what most people are overlooking is that DEX volumes are growing even faster!
This isn’t bad news for CEXs—they’re still thriving. But what really interests us is the growing role of DEXs—and whether there’s an opportunity to benefit from this trend.
So today, we’re breaking down the DEX landscape to see what’s really happening and if there are any investable opportunities to take advantage of.
- Which DEXs are leading in trading volume, and who’s gaining market share the fastest?
- How do DEXs actually make money?
- Are there any challenges that most people are overlooking?
- What trends are shaping the future of decentralized exchanges?
- Most importantly, is there a DEX that stands out as a smart investment opportunity?
P.S. We’re hosting our Monthly PRO Portfolio Update next week — scroll to the bottom for more info. 👀
We hope you’re just as excited as we are.
But before we dive in, let’s first make sure we’re on the same page about the difference between CEXs and DEXs.
- CEX (Coinbase, Robinhood) – Think of it like a traditional Web2 platform. It’s easy to use, but the exchange holds your assets for you (not your keys, not your coins).
- DEX (Uniswap, Aerodrome) –This is a more Web3-native experience—not as user-friendly since you’ll need to connect your wallet, manage gas fees, and handle transactions yourself. But the trade-off? You stay in full control of your funds at all times.
As crypto matures, UX is steadily improving. While it’s not quite at Web2 levels yet, we’re getting closer and closer—and hopefully, we’ll be there soon.
And with the recent $1.5B Bybit hack, security might become an even bigger priority for users...
P.S. Milk Road Swap is our latest attempt at helping you explore crypto, the easy way – if you want to trade onchain with the lowest fees, Milk Road Swap is the place to do it ☺️
Alright, now, time to dive deep into the world of decentralized exchanges!
DEX VOLUMES
We've already mentioned that DEX trading volumes are climbing, but we haven’t shown you the chart yet.
In January, monthly DEX volumes hit an all-time high of $562 billion (we might have Donald Trump to thank for that).
That’s more trading volume in a single month than Coinbase managed in its best quarter! But to keep things fair, let’s do a proper comparison.
To be completely fair, we’re comparing two stocks to an entire sector—so it’s not a perfect apples-to-apples comparison.
But the takeaway is clear: DEXs are no longer just a niche—they’re a major market as they handled over $1 trillion in trading volume in Q4 last year.
These numbers are so significant that they won’t be overlooked for much longer. And that only makes us even more eager to dive deeper.
So let's check out which blockchains are driving the highest trading volumes.
More than 71% of the total trading volume comes from just three blockchains: Solana, BSC (Binance Smart Chain), and Ethereum.
Market distribution matters, but what’s even more interesting is analyzing the chart to spot any emerging trends.
Just two years ago, Solana was barely visible on this chart—now it holds the largest market share.
A similar story is unfolding with Base. It was practically nonexistent a year ago, but today it has secured the #4 spot with a solid 8% share.
Back in early 2021, Ethereum dominated almost the entire market. But since then, its share has been steadily shrinking—not necessarily due to lower volume, but likely because more activity is happening on other chains. Overall, this is a positive sign for the crypto space, showing a growing and more diverse ecosystem.
Finally, we can’t overlook the steady rise of BSC. If we go back to late 2021, BSC once held a massive 50% market share. Given its recent momentum, we might see this trend continue.
Analyzing blockchain market share gives us some insights, but what really matters is which DEXs are actually processing these volumes. In other words, let’s look at which DEXs are driving the action.
About 90% of all trading volume flows through just six DEXs.
What’s interesting is that, on most blockchains, one DEX dominates the market. There’s a strong correlation between a chain’s market share and its leading DEX—PancakeSwap rules BSC, Uniswap leads Ethereum, and Aerodrome dominates Base. But on Solana, there’s no clear winner yet.
Raydium holds 14% of the market, while Meteora and Orca follow with 7% each.
So, the next obvious question is—why is that?
Before we dive into the why, let’s first quickly share how DEXs work and how they actually make money.
Uh, Oh… 😧 The rest of this report is exclusive to Milk Road PRO members!
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WHAT’S LEFT INSIDE? 👀
- The DEX tokens we have our eyes on
- The biggest challenges DEXs face in scaling
- The trends on the horizon for the DEX sector
- The insane efficiency advantages DEXs have over CEXs
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