Blockchain activity has been exhibiting that SushiSwap’s native SUSHI token was handling a significantly higher value than Uniswap’s UNI token. As of December 16th, SUSHI tokens were responsible for 74.35% in terms of the combined value transferred by the two tokens. UNI’s share on the other hand was found to be at a meager 25.65%.
As depicted by the above chart, Pink represents SUSHI’s share while Green represented UNI’s share.
The reason as to why the vampire protocol’s token, SUSHI has been moving more value can be attributed to the fact that SushiSwap provides greater support for liquidity mining. This is a critical process by which the token holders in the market can earn each platform’s native token.
Why is Uniswap lagging?
This has been a setback for Uniswap which ran liquidity mining starting from the period of18th of September to the 17th of November. During the two months, Uniswap distributed 20 million UNI. However, the decentralized exchange has not notified if it plans to continue this feature. Moreover, a vote to continue running liquidity mining with lower rewards has so far failed to meet quorum.
Despite this, Unsiwap’s overall trading volume far exceeds that of its clone which handles quite less volume than the former. While acknowledging that UNI held an undeniable moat in the market, DeFiance Capital’s Eugin Lee noted that new products and innovations could still disrupt it, something that the community is seeing in SUSHI currently.
The two rival protocols have every ardent follower, but according to Lee, “both can do well”. Justifying the argument, Lee went on to provide a “moat” that is possessed by both UNI and SUSHI and stated that can essentially both list tokens that centralized exchanges cannot.
In addition, the liquidity provisions in UNI and SUSHI returns an LP token collateral that can be re-staked or restructured into other farm or collaterals protocol. This is something that their centralized counterparts or even aggregators do not offer.
Furthermore, Low transaction fees and slippage among other decentralized exchanges is another plus point according to the analyst who asserted that low trans fees and slippages mean that aggregators will prioritize UNI and SUSHI since the transaction fees and slippages for both DEXs were currently the same.
In short, though market participants may prefer Uniswap as an exchange, it cannot be ignored that the market was found to be moving a larger amount of SushiSwap’s native token. And considering the nascency of the space, there is enough space in the industry to accommodate both and let time decide what drives up the appeal of both the tokens in the coming days.