CoinGecko recently released its Q2 2022 cryptocurrency report, which saw a 75% drop in DeFi market capitalization in the second quarter, but the report acknowledged that the industry retained most of its users. In some cases, DeFi activity has seen a huge spike.
CoinGecko identified two of the reasons. The first was in early May, during the Terra collapse. Thousands of DeFi users have flocked to decentralized (DEX) exchanges such as Curve and Uniswap to sell their LUNA and UST holdings, as some centralized exchanges (CEXs) occasionally stopped trading in these assets.
As a result, the trading volume of these DEXs has skyrocketed. The second time was in June, when crypto lending platform Celsius imposed withdrawal limits on its users. Traders headed to DeFi protocols to enjoy permissionless trading, resulting in a 24% surge in daily active users of DeFi protocols.