Uniswap hits record Layer 2 volume as DeFi demand rebounds.

In November, Uniswap reached an impressive $38 billion in trading volume across major Ethereum Layer 2 solutions such as Base, Arbitrum, Polygon, and Optimism. This figure represents a $4 billion increase over its previous record of $34 billion, which was set back in March of this year. 

According to data from Dune Analytics, this surge in trading volume comes amid an ongoing resurgence within the decentralized finance (DeFi) space. 

Henrik Andersson, the Chief Investment Officer at Apollo Crypto, pointed out that the recent growth of Uniswap's volume on Ethereum Layer 2s is reflective of a broader increase in demand for assets, particularly stablecoins, which are fundamental to DeFi protocols. He suggested that the upward trend in Uniswap's activity aligns with the revival of DeFi and the recent strength of Ethereum and Bitcoin (ETH/BTC). Additionally, he noted that rising on-chain yields could be driving more liquidity into these platforms.

Andersson believes that this uptick in DeFi activity could be the beginning of a period where the Ethereum ecosystem outperforms other blockchain ecosystems, signaling the potential for greater adoption and activity in the Ethereum Layer 2 space. 

In particular, Uniswap saw the largest chunk of its monthly volume on Arbitrum, totaling $19.5 billion, while Coinbase's Layer 2 network Base closely followed with $13 billion. These numbers highlight the growing importance of Layer 2 solutions in easing Ethereum's scalability issues and providing faster and more affordable transactions for users and DeFi participants.

Beyond volume, Uniswap's performance in terms of fees also stands out. The decentralized exchange (DEX) generated over $90 million in fees in the last month, making it one of the top protocols in terms of revenue. Uniswap has outpaced other major networks like Solana's memecoin launchpad Pump.fun, as well as established blockchain networks such as Tron and Maker, further solidifying its position as a dominant player in the DeFi space.

The growth in trading activity and fees has positively impacted the price of Uniswap's native token, UNI. UNI has surged by over 42% in the past week, reflecting the heightened activity on the platform.

As of now, UNI is trading at $12.58, marking a 10% increase within the last 24 hours. This impressive price increase places UNI among the top-performing decentralized exchange tokens, with the token outperforming competitors such as Raydium, which has seen a 2.2% decrease in the last week, and Jupiter, which has risen by 7.7% in the same period. 

Overall, this record-breaking performance by Uniswap highlights the growing strength and resilience of Ethereum Layer 2 solutions and positions Uniswap as a leading force within the DeFi ecosystem. With increasing volumes, rising fees, and strong token performance, Uniswap’s continued success could signal broader positive trends for Ethereum and its Layer 2 networks in the coming months.