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Uniswap proposes fee reduction and that means…

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Uniswap V4 is poised to revolutionize fees by integrating EIP-1153 and a singleton architecture, promising enhanced efficiency and potential cost reduction.

Uniswap proposes fee reduction in V4 with EIP-1153 integration

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  • Uniswap aims to reduce fees on its platform by 99% on its V4.
  • UNI was currently on a positive run as it added less than 1% to its value.

Uniswap version 4, currently under development, holds exciting potential with the inclusion of EIP-1153. The team dropped hints about some of the features it might bring. One aspect worth exploring was how this integration could impact fees.

Furthermore, it’s essential to understand the current state of fees on the Uniswap network. So, what are the plans for incorporating EIP-1153, and what is the prevailing fee landscape?


– How much are 1,10,100 UNIs worth today


Uniswap to fuse EIP-1153 with singleton architecture

Uniswap recently provided insights into integrating the new EIP-1153 within the upcoming V4 of their platform. In their post, they explained how this Ethereum proposal would synergize with the singleton architecture adopted by V4. The singleton contract acts as a centralized entity overseeing all token pairs within the protocol.

This innovative approach brings substantial benefits in terms of gas efficiency and reduces the expenses associated with deploying new trading pairs by an impressive 99%. Furthermore, the singleton contract incorporates a flash accounting system, contributing to cost reduction by conducting internal transactions before finalizing balances. This intelligent mechanism helps optimize gas costs. 

Ethereum Improvement Proposal 1153 (EIP-1153) marks a noteworthy advancement in enhancing transaction execution efficiency on the Ethereum blockchain. By introducing transient storage opcodes, this proposal aims to streamline operations and decrease expenses linked to storage during smart contract execution.

Overall, Uniswap’s objective with these remarkable features is to drive fee reduction on their platform. Leveraging the benefits of EIP-1153 and the singleton architecture would make this possible.

Current fee trend on Uniswap

Based on data provided by DefiLlama, Uniswap V3 has been generating a substantial volume of transaction fees. As of the present moment, the platform accumulated annualized fees exceeding $323 million. Additionally, the daily fee currently stood at approximately $507,000.

However, when considering the overall annualized fees across the platform, the figure surpassed $400 million as of the latest data available. Furthermore, the Total Value Locked (TVL) on Uniswap V3 was over $4 billion. This indicated a stable and significant amount of value entrusted to the platform by users.

UNI on an uptrend

The daily timeframe chart of Uniswap [UNI] showed that it had experienced modest upward movements. As of this writing, UNI was trading around $5.2, with a marginal profit of less than 1%. The Relative Strength Index (RSI) indicated a bullish trend, albeit weak, while the Moving Average Convergence Divergence (MACD) suggested a similar sentiment.

Uniswap/USD price move

Source: TradingView


– Is your portfolio green? Check out the Uniswap Profit Calculator


Regarding the upcoming V4 of Uniswap, how effective it will be in terms of fee reduction remains to be seen. However, a potential reduction in fees could attract more users and drive increased traffic to the network.

 

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Adewale is a full-time journalist at AMBCrypto. While he is increasingly fascinating by the world of blockchain and cryptocurrencies, Adewale holds a degree in International Relations. Besides working on insightful articles that touch upon the crypto-space's hottest issues, he finds joy in supporting Manchester United and Afrobeat music.
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