Uniswap is a decentralized exchange (DEX) on the Ethereum blockchain, allowing users to swap and provide liquidity without permission. It operates on five chains, including L2s, and is among the first DEXs, enabling seamless token trading and liquidity provision without intermediaries.
$UNI Governance: UNI holders can vote on proposals to update the protocol, including fee changes and new token listings. Liquidity provision: Users can provide liquidity to earn fees. There was also a liquidity mining phase where liquidity providers (LPs) received UNI rewards.
Governance rights As the sole utility of the $UNI token, users holding the token can exercise voting power in the Uniswap governance system. This attracts individuals who are invested in the long-term success of the protocol and want a say in its future direction. Potential fee-sharing Discussions around fee-sharing with $UNI token holders hav generated interest among traders and investors seeking additional financial incentives. This could further drive demand for the token as it potentially o
The value created by Uniswap protocol enables decentralized and permissionless trading of cryptocurrencies without intermediaries. This offers greater asset control, and enhanced privacy/security. The AMM algorithm ensures fair pricing, while liquidity providers earn fees. Uniswap supports multiple blockchains, promoting accessibility and interoperability. It has democratized financial services and propelled DeFi growth.
Value accrual to token: $UNI token holders do not receive any fees generated from Uniswap pools, but they do have governance rights that allow them to vote on proposals that impact the protocol's future. As the platform grows and becomes more valuable, demand for $UNI tokens may increase, causing their price to rise. Value accrual to protocol: Uniswap does not capture any additional value directed to its treasury since all fees go to liquidity providers. However, due to $UNI speculation
The business model for Uniswap protocol: Revenue comes from: 0.3% fee on trades in liquidity pools. Revenue is denominated in: whatever assets are being traded. Revenue goes to: 100% of fees are directed to Liquidity Providers (LPs). Uniswap treasury does not generate income, and only holds $UNI tokens.
|Problems & Solutions
Problem: Centralized exchanges have slow transactions, high costs, limited trading pairs, and lack transparency, which decreases liquidity and increases risks for traders. Solution: Uniswap is a decentralized exchange on Ethereum that solves these issues. Its automated market maker algorithm allows for fast trades and high liquidity for any ERC-20 token. Additionally, Uniswap's open-source protocol provides transparency and security, mitigating trading risks for users.
SushiSwap - A decentralized exchange platform that uses an automated market maker (AMM) model similar to Uniswap. Balancer - A decentralized exchange platform that allows for the creation of customized pools with varying token weights. Curve - A decentralized exchange platform that focuses on stablecoins and provides low-slippage trades through a specialized AMM algorithm.
... coming soon
Uniswap V2 Launch
V2 allows ERC20/ERC20 Swaps
Uniswap V3 Launch
New concept: Concentrated Liquidity
UNI Token created