Uniswap [UNI] Sees Growth from Base Influence but Faces TVL Decline

• Base, a layer-2 blockchain, has significantly contributed to Uniswap’s recent user growth.
• Despite this, the Total Value Locked (TVL) in Uniswap has seen a decline.
• Market analysts are observing the ongoing price trends and network growth of UNI.

Uniswap sees notable user growth due to Base, but will it sustain?

Base tokens influence, yet challenges persist for Uniswap

Uniswap has recently seen an uptick in user activity, thanks largely to its deployment on the Base network in August 2023. This integration has made it easier for traders to handle tokens built on this layer-2 solution.

Memecoins and Market Dynamics

BRETT, a popular memecoin on Base, recently surged to an all-time high, driving substantial trading volumes through decentralized exchanges. As Uniswap is a leading DEX on the Ethereum network, its involvement with BRETT and other tokens on Base has been significant. However, broader market uncertainties pose potential risks for sustained growth.

Challenges in Uniswap’s TVL and Market Sentiment

Despite favorable developments, Uniswap’s Total Value Locked (TVL) has decreased by 11.68% recently. TVL is a key indicator of the amount of assets locked within a protocol and is often seen as a measure of market confidence. Currently, Uniswap’s TVL stands at $5.58 billion, reflecting an 11.38% drop in the past month, which may indicate growing market skepticism.

Market Outlook and Future Projections for UNI

Base’s TVL has similarly faced a reduction, standing at $1.55 billion after a 9.81% drop over the past month. A continual decline in activity and liquidity on Base might hinder Uniswap’s growth trajectory. Conversely, a resurgence in Base’s TVL could positively impact Uniswap’s performance and user activity.

Currently, UNI’s price is at $9.12, showcasing a 9.07% decline over the last 24 hours. On-chain metrics, particularly Network Growth—which monitors new addresses making their first transaction—suggest further potential declines if current trends persist. Network Growth has dropped to 109, implying reduced traction and lower demand.

Conclusion

Uniswap’s recent user growth attributed to the Base network is noteworthy, but sustaining this momentum amid declining TVL and market uncertainties remains a challenge. Market participants and analysts will be closely watching developments in Base’s TVL and Uniswap’s Network Growth metric, which will play crucial roles in determining the future price action and adoption of UNI.