All you need to know about Uniswap’s latest upgrade
- Uniswap said that V4 would result in 99% reduction in pool creation gas costs.
- Over the last week, Uniswap volume rose by 7.39%, an uptrend seen across major DEXs.
The world’s largest decentralized exchange by volume Uniswap [UNI] has unveiled the vision for its latest version V4. The new protocol is aimed at increasing efficiency and reducing costs.
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The decentralized finance (DeFi) behemoth released the draft code of V4 for public access and invited community members for feedback before a full-fledged launch, which could take months as per the blog post.
The euphoria surrounding this development caused native token UNI to lift up to $4.45 on 13 June. However, the jump was short-lived as UNI retreated to $4.27 at the time of publication, down 1.2% in the 24-hour period, as per CoinMarketCap.
1/ Today, we’re announcing our vision for Uniswap v4 ?
We see Uniswap as core financial infrastructure & think it should be built in public with space for community feedback and contribution.
— Uniswap Labs ? (@Uniswap) June 13, 2023
What’s new in Uniswap V4?
Uniswap was the first to popularize the mechanism of concentrated liquidity through the launch of its V3. This gave liquidity providers (LPs) more flexibility in how they wanted to deploy liquidity.
The latest version V4 advances things further by introducing the idea of customizable liquidity through the usage of “hooks”.
Hooks, as defined by Uniswap, are plugins which will enable users to create custom liquidity pools to control how pools, swaps, fees interact with each other.
Uniswap outlined other use cases that developers might leverage, such as implementing on-chain limit orders, dynamic fees, and many more automated functions that could be done at a specific time in a pool’s lifespan.
Apart from hooks, the other betterment will be clubbing all pools in a single smart contract. In V3, a new contract has to be deployed every time a pool is created. This new architecture of V4 would result in 99% reduction in pool creation gas costs.
Uniswap gains from SEC lawsuit
Uniswap was the undisputed leader of DEXs with a 24-hour volume of nearly $880 million, more than double the total volume of the second-ranked PancakeSwap [CAKE], as per DeFiLlama.
Over the last week, the volume rose by 7.39%, an uptrend seen across major DEXs. The recent action by U.S. regulators on their centralized counterparts like Binance and Coinbase could be the primary driver behind the surge.
How much are 1,10,100 UNIs worth today?
UNI holders still at a loss
Despite gains on DeFi front, UNI extended its losing streak. The 30-day MVRV Ratio revealed that holders would incur a loss of 9.63% on average if they were to sell their holdings at press time.
The investors’ confidence in the potential of UNI fell after a temporary lift following SEC’s lawsuit.