Year-End 2020 Crypto Market Review: Ethereum and SushiSwap Milestones
In the second half of 2020, the global cryptocurrency market experienced a significant recovery, with Ethereum (ETH) price performance and the rise of the decentralized finance (DeFi) protocol SushiSwap emerging as two major highlights. These events not only boosted market sentiment but also laid the foundation for the subsequent bull run.
Ethereum Price Breaks Above $470
In mid-November 2020, Ethereum (ETH) showed particularly strong price performance, successfully breaking through the key psychological barrier of $470. For instance, according to historical data, on November 11, 2020, the ETH/USDT trading pair price touched approximately $497.76, subsequently maintaining around $474.26 and $468.95 on November 12 and 13, respectively. This surge was part of the broader crypto market recovery wave at the time, reflecting investor confidence in the Ethereum ecosystem and its future development. On November 1, 2020, Ethereum's price was approximately $396.36, with a circulating supply of about 113.25 million ETH, and its market capitalization had reached approximately $44.888 billion. These historical market data can be viewed on market platforms such as Svmuu.
SushiSwap Total Value Locked (TVL) Exceeds $1 Billion
Alongside Ethereum's price surge, the DeFi sector welcomed a new player—SushiSwap. Launched on August 27, 2020, as a fork of the decentralized exchange Uniswap, the protocol quickly garnered significant attention with its innovative tokenomics model and liquidity mining reward mechanism. Within just three days of its launch, SushiSwap's Total Value Locked (TVL) surpassed $700 million, and within four days, it rapidly broke the $1 billion mark.
SushiSwap's most notable move occurred on September 9, 2020, when it successfully executed a "vampire attack" on Uniswap. By incentivizing users to migrate their Uniswap liquidity provider (LP) tokens to the SushiSwap platform, the protocol attracted over $1.3 billion in liquidity in less than 24 hours, bringing its reported TVL to $1.35 billion. This massive migration led to a significant drop in Uniswap's liquidity by nearly 70%, from approximately $1.7 billion to around $540 million, highlighting the fierce competition within the DeFi space.
Key Stakeholders and Community Dynamics
- Anonymous Developers: SushiSwap was initially created by anonymous developers Chef Nomi and 0xMaki, who built the protocol based on Uniswap's open-source code.
- Sam Bankman-Fried: After Chef Nomi sparked controversy by converting developer funds into ETH, Sam Bankman-Fried, then CEO of FTX exchange, intervened, taking over operational control of SushiSwap and pledging to stabilize the community and retain liquidity providers through the distribution of 2 million SUSHI tokens.
- DeFi Users: A large number of DeFi users and liquidity providers (LPs) were attracted by SushiSwap's SUSHI token reward mechanism, actively participating in "yield farming" by staking their LP tokens on SushiSwap.
- Community Resilience: Despite the controversies surrounding SushiSwap's launch, particularly regarding Chef Nomi's handling of funds, the community ultimately demonstrated strong resilience. Through collective efforts and new leadership, the project was able to continue its development. This event also profoundly reflected the risks and challenges that the DeFi sector may face in the process of rapid innovation and decentralized governance.
