GMX is witnessing an increase in fees as demand for ARB and AVAX grew. Despite the growth of protocols, GMX token prices continue to fall.
GMX has been one of the most prominent dApps on the Arbitrum [ARB] network. However, when the ARB token was announced, there was a lot of speculation that it could have a negative impact on GMX.
Read the GMX 2023-2024 price prediction
Plot twist
However, recent data suggested that the GMX protocol ultimately benefited from the increased interest in ARB. According to data analytics platform Artemis, the fees are generated by the GMX protocol via ARB and Avalanche [AVAX] increased sharply in recent days.
Source: Artemis
The high fees that GMX generates can have many consequences.
Realistic or not, here is GMX’s market cap in terms of BTC
First, it indicates that the platform is experiencing higher trading volumes, potentially leading to increased income and liquidity. This can make the platform more attractive to users and investors as it can provide more trading and profit opportunities.
Source: Artemis
GMX: statistics analysis
The high trading volumes of the GMX protocol can be attributed to several factors such as liquidations, swaps and margin trading. However, the biggest contributor to the increased trading volumes is margin trading. Margin trading refers to a method of trading where users can borrow money from the platform to trade assets with leverage, potentially increasing their profits.
However, trading with high margins can also increase the platform’s risk exposure. Margin trading involves borrowing money to trade assets with leverage, which can result in significant losses if the trades do not perform as expected.
Source: Dune analysis
The GMX protocol uses the increased revenue generated by increased fees to improve its infrastructure. According to data from Token Terminal, there has been a 25% increase in active developers and an 85.5% increase in code commits in recent months. This suggests that the platform is investing in its development and improving its technology to effectively meet user demand.
Source: Token Terminal
Unlike the protocol, the token performed less well. According to data from Santiment, the price of GMX has fallen significantly in recent days. Moreover, the volume of the token also fell during this period. However, the overall MVRV ratio remained positive, implying that there were addresses that still had an incentive to sell despite declining prices.
Source: Sentiment
This post GMX: Will the dApp’s fortunes change as interest in AVAX and ARB rises?
was published first on https://ambcrypto.com/gmx-will-the-dapps-fortunes-change-as-interest-in-avax-and-arb-soars/
