Uniswap’s UNI token is in the green after the decentralized exchange announced the launch of Uniwap V3 on the Arbitrum network after it was voted through by the community members.

UNI is currently trading at $30 after rallying by 8.50% in the last 24 hours while its weekly performance indicates that it is up by 16% in the last 7 days. The recent rally extends the cryptocurrency’s recovery after the recent dip which allowed it to cool off from the previous robust rally that kicked off towards the end of July. The current rally comes amid the increasing demand for DeFi platforms.

Source: Binance

UNI’s recent price surge was characterized by an upsurge in buying volume but the RSI currently indicates that it is headed towards the overbought zone, although it is not there yet. This suggests that there might be room for some more gains in the next few days before another substantial selloff. Some cryptocurrencies managed to set new all-time highs last week but UNI is still trading significantly lower than its all-time high of $45.

Unraveling the spark for the recent rally

Many cryptocurrencies usually experience a rally when there is a major upgrade to their native blockchain or network, or when their native platform goes through some improvements. This is the case with the Uniswap platform following a Uniswap announcement that the decentralized exchange is deploying on the Arbitrum mainnet.

The deployment is an important development especially for Uniswap users because it will allow them to move their tokens and cryptocurrencies to Arbitrum where they will enjoy significantly cheaper transaction costs without compromising on security and decentralization. This comes at a time when users have been complaining about high Ethereum fees. Such a move has the potential to boost Uniswap’s demand, thus contributing to more transactions and subsequently more value and growth for the UNI token.

Launching on Arbitrum is a good move for Uniswap because the network has been growing at a rapid pace. It might also pave the way for more projects to launch on Uniswap V3 thanks to the improvements of public smart contracts that interact with the Uniswap V3 codebase. The deployment will also likely fuel the adoption of the DEX on all major blockchains because the code facilitates easier integration.

Will UNI set a new all-time high?

The latest bull market is expected to peak towards the end of September, which means there is still some room for growth. UNI thus has a chance to potentially set a new all-time high especially if it continues enjoying strong demand. On the other hand, the cryptocurrency market is highly volatile and an unexpected black swan event might easily trigger another massive selloff. However, UNI’s long-term outlook is still bullish especially now that DeFi is growing faster than ever before.

Meanwhile, the recent upgrades and the possibility of Uniswap coming to more chains may also contribute to more adoption. If that will be the case, then there is no doubt that Uniswap will maintain its lead in DeFi, and UNI is poised for strong growth in the future.