The competition for supremacy among decentralized derivatives exchanges has taken a new direction after data aggregator DefiLlama removed Aster due to worries about data authenticity.
Aster, a derivatives decentralized exchange (DEX) supported by YZi Labs (formerly Binance Labs), recently experienced a trading volume spike that allowed it to surpass Hyperliquid, recognized as one of the standout performers in the crypto sector.
However, on Sunday, DefiLlama founder 0xngmi mentioned on X that Aster’s reported volumes mirrored those seen in Binance’s perpetuals market, which led to its delisting.
This delisting has triggered a wider discussion on the influence of data providers. Advocates for Aster accused DefiLlama of centralization, while skeptics debated whether Aster’s rapid growth was authentic or artificially created.
Aster’s rise reignites discussions on fake trading volumes
Aster led all DEXs in trading volume on Monday with $41.78 billion in 24-hour trading, per Binance-owned data aggregator CoinMarketCap. Meanwhile, Hyperliquid recorded over $9 billion.
Aster did not respond to Cointelegraph’s inquiry regarding this matter.
“Wash trading and inflated usage volumes are currently estimated to impact [a quarter] of exchanges today,” remarked Greg Magadini, director of derivatives at Amberdata, to Cointelegraph.
Magadini explained that volume inflation typically falls into two categories: traders artificially increasing their activity to earn rewards or qualify for airdrops, and exchanges overstating user activity to lure in authentic volume.
On Tuesday, X user Dethective identified the top five wallets that accounted for $85 billion in trading volume on Aster over a 30-day period in anticipation of the airdrop. However, not all the leading wallets appear dubious. In a post dated Sept. 30, Dethective examined Aster’s top 10 traders and noted that while some seemed to engage in genuine trading activities, at least two were suspected of Sybil behavior, likely aiming to farm airdrop points.
Trading volume may be inflated via high-frequency bots that swiftly open and close positions. In contrast, open interest indicates positions that require traders to lock up collateral and incur funding over time.
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Among perpetual DEXs, Hyperliquid topped with $14.68 billion in open interest on Monday, followed by Aster with $4.86 billion and Lighter with $2.08 billion, based on CoinMarketCap data.
Aster supporters ironically promote Dune
DefiLlama is among the most widely utilized data platforms in decentralized finance (DeFi), monitoring protocols across significant chains and ecosystems. Its choice to delist Aster has consequently created a gap for users seeking dependable data on the burgeoning perpetuals exchange.
Some users criticized DefiLlama’s action as “centralized,” instead advocating for Dune Analytics as a favored alternative. Dune allows users to create and publish customized dashboards. The irony lies in the fact that several Dune dashboards referenced by DefiLlama’s critics rely on DefiLlama’s own data.
DefiLlama’s 0xngmi responded to the criticism on X, denying accusations that the company was compensated to delist Aster or that it was unfairly targeting the exchange.
“We are not,” 0xngmi stated. “We delisted Lighter and numerous other perp DEXs previously due to blatant wash trading.”
Wash trading has consistently posed challenges for crypto data providers. During the NFT market boom, users on the marketplace Blur were accused of inflating trading metrics to be eligible for upcoming airdrops, briefly enabling the platform to surpass OpenSea in volume.
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In traditional finance, wash trading is outlawed under capital markets and securities regulations, yet in the evolving crypto landscape, oversight remains limited, with detection largely dependent on analytics firms. These companies generally identify suspicious patterns through “round-trip” trade analysis.
“A hallmark of wash trading is when a large proportion of an exchange’s volume consists of identical buy and sell trades occurring in quick succession,” Magadini noted. “When this behavior recurs across multiple pairs, it strongly suggests that the volume is being artificially inflated.”
Aster controversy underscores difficulties in quantifying DeFi
The removal of Aster underscores the persistent challenges in establishing truth in decentralized markets. Disputes like these reveal how swiftly questions regarding numbers can morph into inquiries about trust.
Aster’s ascension and the subsequent examination it faced illuminate the fiercely competitive environment of DeFi platforms vying to gain supremacy in perpetual trading volume, which accounts for approximately 80% of the crypto market.
Trading volume can be a deceptive metric, particularly when airdrop incentives and automated strategies skew what appears to be authentic activity. Open interest, funding fees, and collateral data provide clearer indicators of real engagement, yet they are frequently neglected in the quest for visibility.
Regardless of whether Aster’s swift growth is authentic or inflated, DefiLlama’s critique of its metrics illustrates the fragile nature of confidence in data within the crypto realm. Trading volume continues to influence perceptions, even when its accuracy remains questionable.
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