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Building Financial Markets on Blockchain

Tokens are the next generation for markets - Larry Fink, BlackRock CEO

I agree. But what is the state of the current market? Which financial markets have we brought onchain.

We will answer the this question in three steps to give you a broad overview:

  • What are the major decentralized financial markets measured in total value locked (TVL)

  • What do these market do

  • Who are the top 3 players in each

Let’s dive in.

Decentralized Finance (DeFi)

If the term DeFi is new to you, it helps to simply think of it as finance on crypto rail. For example, finance is trading on your Robinhood app or trading on your Bloomberg terminal. DeFi is trading on Uniswap with a crypto wallet such as Metamask.

Like Mr Larry Fink, I also believe that eventually all of finance will exist onchain, from stock trading to structured products issuance.

Of course we are not there yet. So what do we have onchain today? Below are the top verticals measured by TVL.

  1. Liquid Staking

  2. Borrowing/Lending

  3. Decentralized Exchange (Spot)

  4. Perpetual Swaps

  5. Tokenized Credit

  6. Options

Let’s go through them.

Liquid Staking

At $20bil+ TVL, liquid staking is the biggest DeFi category. It came about as a result of Ethereum’s upgrade from Proof of Work to Proof of Stake. It allows users to earn a yield on their locked-up staked ETH. You can find out more here.

Currently there are 26.5 million ETH being staked and liquid staking accounts for 10.8mil ETH or about $20 billion.

The 3 biggest liquid staking players are.

  1. Lido

  2. Coinbase

  3. Rocket Pool

Lido is the dominant player in this category with over 80% market share. Coinbase comes in at 10%. Rocket Pool takes home 3%.

The key thing to remember here is that the liquid staking market grows with the USD value of ETH. Since the business model for the sector involves taking a service fee in return for offering the technology service, the higher the USD value of ETH, the more fees liquid staking providers make even with the same take rate.


At $14bil+ TVL, lending/borrowing is the 2nd largest vertical. Whereas in traditional finance, you can take out a loan based on your credit worthiness, onchain lending is mostly overcollateralized. This reduces capital efficiency but ensures smooth liquidation and reduces the chances of bad debt.

During the centralized exchange meltdown period in 2022, onchain lending/borrowing ensured lenders got their money back while centralized lending at FTX, Genesis, 3AC went bankrupt and had a daisy chain effect.

The top 3 players in this field are:

  1. MakerDAO

  2. Aave

  3. JustLend

Decentralized Exchange

At $5.6bil+ TVL, decentralized exchange (DEX) is the 3rd largest vertical onchain. Just like traditional financial exchanges such as NYSE or LSE that enables trading of spot instruments, DEX is the infrastructure that enables trading on the decentralized crypto rail.

Currently DEX trading volume is roughly 15% of the centralized trading volume.

Just like Nasdaq trades mostly tech stocks whereas CME is mostly options and futures, there are different decentralized exchanges focusing on different products.

For Spot DEX trading, here are the top projects.

  1. Uniswap

  2. Pancake

  3. Curve

Below is the last 7 days total volume across the sector.

Uniswap and Pancake are miles ahead of the rest. Uniswap takes the no.1 spot with 56% market share. Pancake follows with 20%. Curve takes home 7%.

Perpetual Swap

At $1.1bil+ TVL, perpetual swap is the 4th largest vertical. Arthur Hayes, the founder of BitMEX, a crypto exchange, invented the whole product category. A perpetual swap is a derivatives contract similar to a futures contract. Compared to spot, perpetuals allow traders to bet on assets with leverage/capital efficiency. As a result, it is a far more popular way to trade.

Below shows the total monthly volume.

The top 3 projects in this space are:

  1. dYdX

  2. Synthetix (Kwenta)

  3. GMX

See the chart below for more details

Tokenized Credit

At $650mil TVL, tokenized credit sector is the 5th largest vertical. This segment of the market is made up of both tokenized private credit and public credit. Whereas private credit consists of a variety of assets from trade finance receivables to US ABS, public credit is dominated by short term US treasury bills.

The tokenized US treasury business has exploded out of the gate, going from 0 to $300 in short months.

The biggest projects in this group are:

  1. Centrifuge

  2. Ondo

  3. Matrixdock

I expect to see phenomenal growth in AUM in this category as more and more crypto capital seek to access an attractive US risk-free rate through tokenization platforms. You can read more about the subject here.


At $100mil TVL, Options market in crypto is still quite small in comparison to its more easily understood cousin the perpetuals market. Whereas a retail user can wrap his/her head around the concept of leverage, the Greeks require much more effort.

See the chart below to see how the Options market compares to the Perps market.

Top 3 projects of Options vertical are:

  1. Ribbon

  2. Lyra

  3. Dopex

With a cumulative notional volume of $13.9bil, Ribbon is the undisputed leader of onchain options market.

Lyra takes the 2nd place with $987mil notional traded while Dopex takes the 3rd place with $64mil.


It is not hard to see when judged on

  • volume of trades and

  • liquidity availability

  • product variety

onchain markets are far from the same sophistication level as the traditional financial markets.

However, with hundreds of projects speed running through financial history and tens of billions of capital backing their endeavours, we will likely see replication as well as innovation in these onchain markets in the future.

To reach that future, we have already started on the foundation. Below is a summary of the main markets that exist on blockchain today and their major players.

Disclaimer: This content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.


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