Uniswap the decentralized trading protocol guarantees liquidity for millions of users and hundreds of Ethereum applications.
Uniswap is a growing protocol ecosystem which empowers developers, liquidity providers and traders to participate in a financial marketplace which is open and accessible to all.
The protocol facilitates, a suite of tools for a tokenized world. They are building the state of art open source apps to access the Uniswap protocol to further contribute to the world of decentralized finance.
For clarity on tools, Socks is an experiment in tokenized socks. Analytics is the data for the Uniswap Protocol. App is used to swap tokens and add liquidity. Tokens lists refers to a new Ethereum token lists standard. Sybil is a tool for on-chain governance.
Sybil does the job of mapping on-chain addresses to digital identities to maintain a list of delegates, all while avoiding pesky user sign ups, on-chain transactions, and manual record keeping.
The superpowers for DeFi developers are the token swaps, programmable liquidity, flash swaps, and oracles.
Token swaps refers to the process of integrating Uniswap in to a project. Programmable liquidity is a step by step guide to getting started building interfaces with Uniswap. Flash Swaps are used to withdraw the reserves of any ERC20 token on Uniswap to execute an arbitrary logic.
The Oracles are highly decentralized, manipulation resistant, on-chain price feeds.
Uniswap v3 is introducing concentrated liquidity, thus giving individual LPs granular control over what price ranges their capital is allocated to. Also, individual positions are aggregated together into a single pool, thus forming one combined curve for users to trade against.
There are multiple fee tiers, which makes it possible for LPs to be appropriately compensated for taking on varying degrees of risk.
Uniswap v3 is claimed to be the most flexible and efficient AMM ever designed. Also, LPs will be able to provide liquidity with nearly 4000x capital efficiencyrelative to Uniswap v2,thus earninghigher returns on their capital.
Also, the capital efficiency creates the way for low-slippage trade executions which will be able to surpass both centralized exchanges and stablecoin-focused AMMs
The LPs will be able to significantly increase their exposure to preferred assetsandalsoreducing their downside risk.
Further, LPs will be able to sell one asset for another by adding liquidity to a price range which is entirely above or below the market price, thus approximating a fee-earning limit order which gets executed along a smooth curve
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