In its latest tweet, analytical firm Glassnode shared a chart showing that the amount of ETH blocked in smart contracts significantly exceeded the supply of ETH on cryptocurrency exchanges. This means users prefer to use Ethereum to enjoy the benefits of DeFi than to trade.
ETH supply in smart contracts is growing
Glassnode released data showing that the amount of Ethereum blocked in DeFi smart contracts exceeded the amount of ETH stored on centralized cryptocurrency exchanges.
As can be seen from the chart, ETH movements began to move in opposite directions around August 24. At that time, the ETH curve blocked in smart contracts began to rise sharply. The amount of ETH stored on centralized trading platforms such as Binance, Coinbase, etc. has started to decline.
ETH supply on centralized exchanges 📉
ETH supply in smart contracts 📈#Ethereum
– glassnode (@glassnode) September 18, 2020
This is also the time when the YAM project began to gain immense popularity. Users started to stack huge amounts of different cryptocurrencies in it, including ETH, using different pools.
At that time, the president of BItMEX tweeted that he had become a yield farmer, while Erik Voorhees criticized DeFi, calling it another cryptocurrency scam.
Among the decentralized exchanges through which Etherum flows en masse is, among others recently launched Uniswap.
Doubts about DeFi
Some industry experts remain skeptical of DeFi. For example, Tone Vays, which recently called decentralized financial platforms and contracts “even more idiocy than ICOs.”
Glassnode also shared another chart that shows that new users are constantly pouring into the Ethereum network. They are probably encouraged by the considerable profits from yield farming.
According to these data, the number of addresses storing> 0 ETH increased to ATH amounting to 47 122 017 units.
Previous ATH of 47,119,609 was observed earlier today
– glassnode alerts (@glassnodealerts) September 18, 2020
If you are interested in the topic of decentralized finance, we invite you to read our extensive article on this topic: DeFi, or Decentralized Finance. How can you benefit from them?