Overview

Despite being plunged into the steepest bear market, by volume, in the history of the cryptocurrency market, the DeFi market’s Total Value Locked (TVL) still sits at $107 billion, which demonstrates that the DeFi sector is still relevant in 2024. Interestingly, at the heat of the 2022 to 2023 bearish season, the TVL of the DeFi pools saw a 17.2% surge since October 2022.

Noteworthy categories dominating the space include DeFi lending and borrowing, trades over decentralized exchange (DEX) protocols, liquidity staking, and derivatives. This growth can be seen in the number of active wallets, reaching 57 million, an impressive 271% growth in active DeFi wallets since 2022.

However, the drawback of this situation is an even greater demand for deep liquidity across the thousands of active liquidity pools on these chains. The price of high demand in deep liquidity is high slippage and an exponential increase in network and protocol fees across these chains.

Aggregatory solutions have emerged to tackle the challenges in the DeFi space. The most prominent examples among them are liquidity aggregators like 1inch, Matcha, Paraswap, Jupiter Station, Cowswap, and several others; each with its unique advantage.

For example, the 1inch Pathfinder Algorithm analyzes liquidity sources across multiple DEXes, minimizing slippages, primarily on the Ethereum chain. Paraswap, on the other hand, aggregates liquidity from various DEXs and liquidity pools, providing versatility in trading options as well as offering margin trading and risk management. Another great example is Jupiter Station, operating on the Solana chain, which mainly offers multi-DEX aggregation and dynamic gas price adjustment.

But there is nothing like that on the Injective network.