Uniswap promises protocol growth, but what about UNI?
- Uniswap Foundation released its cross-chain bridge assessment report.
- The protocol’s activity declined while the upcoming v4 launch promised to revitalize interest.
Leading DEX Uniswap [UNI] recently released its cross-chain bridge assessment report by the Uniswap Foundation, which may have notable repercussions on the protocol.
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Crossing the bridge to the top?
Cross-chain messaging protocols, also known as bridges, play a crucial role in facilitating communication between different blockchain networks. In Uniswap’s case, these bridges enabled the transfer of governance decisions from Ethereum [ETH] to other chains where Uniswap V3 contracts are deployed.
By leveraging cross-chain messaging protocols, the protocol’s decentralized autonomous organization (DAO) ensured that governance decisions made on Ethereum could be effectively implemented across various blockchain networks.
This is vital, considering that the aforementioned V3 contracts exist on multiple chains, necessitating a mechanism to propagate governance decisions across these networks.
The committee responsible for overseeing Uniswap’s governance recently approved specific use cases for Wormhole and Axelar. The committee acknowledged Wormhole’s reputable validator set and satisfactory security thresholds. Similarly, Axelar’s well-considered design and adequate validator set and safety thresholds garnered approval.
However, other protocols such as LayerZero, Celer, DeBridge, and Multichain did not meet the required standards at present.
Uniswap: Still a long way to go
Despite the ongoing developments, the network’s overall activity fell by 20.4% over the past month. According to data from Token Terminal, Uniswap’s declining activity led to a 59.8% decrease in network fees.
Nevertheless, Uniswap’s forthcoming launch of version 4 (v4) holds the potential to reignite interest in the platform. These plugins enable users to create custom liquidity pools and exercise control over the interaction of pools, swaps, and fees.
Realistic or not, here’s UNI’s market cap in BTC’s terms
The market’s response to Uniswap’s developments will unfold with time. At press time, UNI was trading at $4.45, having experienced a minor decline of 0.45% in the last 24 hours, as per CoinMarketCap.
As the protocol continues to evolve, these assessments and upcoming updates may shape the future trajectory of the DEX and its position within the decentralized finance (DeFi) ecosystem.