In the rapidly evolving world of decentralized finance (DeFi) on Ethereum, the first three weeks of November have signaled a substantial shift. A surge in gas fees—a measure of transaction cost and activity on the network—indicates that DeFi is once again gaining traction. Kaiko, a blockchain analytics firm, has pinpointed Uniswap’s intensified operations as the catalyst behind this resurgence, notably due to a spike in transactions involving meme coins, particularly GROK.
Nonetheless, this bubbling activity belies the static price of Uniswap’s native token, UNI, which has stubbornly hovered below the $5.6 mark. Despite the revived engagement in DeFi, UNI’s bulls have been unable to push the token’s value to new heights for the year.
Kaiko’s reports underscore the correlation between gas fees, DeFi undertakings, and the pricing of Ethereum and associated tokens. With gas fees being a reflection of on-chain activity such as DeFi engagement and non-fungible token (NFT) transactions, they tend to rise in sync with market trends. This uptick often signals a broader market upswing, potentially foreshadowing gains for key DeFi tokens like Uniswap and Aave.
In this backdrop of heightened activity, the total value locked in DeFi protocols has surged to over $46.6 billion as of late November, marking a $5 billion increase just since the start of the month, with Ethereum commanding a substantial $25.4 billion of this aggregate total. Amidst these optimistic strides, Uniswap’s TVL has excelled to $3.216 billion, asserting itself as a dominant player in the DeFi domain.
Yet, Uniswap’s token price has not mirrored the protocol’s operational success. As of mid-November, UNI has ascended by 30% from its position in mid-October, yet its price action has remained laterally bound, struggling to break past the November ceiling. The daily charts reveal a tapering trading volume, pointing to an uptrend lacking both momentum and sustainability. For market watchers and investors, the key signpost will be a decisive close above these November highs with substantial volume—which could signal the possibility of UNI rallying to revisit the heights of $7.2 seen earlier in the year.
