Uniswap v4: Customizable And Cost-Effective Solution For DEXs?

Ronaldo Marquez

1 year ago

2 mins read

Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality

Created by industry experts and meticulously reviewed

The highest standards in reporting and publishing

How Our News is Made

Strict editorial policy that focuses on accuracy, relevance, and impartiality

Ad discliamer

Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio.

Uniswap Labs has announced the release of the draft code for Uniswap v4, the next iteration of the popular decentralized exchange (DEX) protocol. Uniswap v3 was a watershed moment for on-chain liquidity and Decentralized Finance (DeFi), processing over $1.5 trillion in trading volume since its release two years ago.

However, as technology and markets evolve, so must the Uniswap Protocol, according to the announcement released today.

Uniswap Labs Unveils V4

Uniswap Labs has revealed the draft code for Uniswap v4, which promises to bring a world of possibilities to on-chain liquidity and decentralized finance. Uniswap v4 introduces a new architecture that reduces costs and increases efficiency, making it a more powerful and flexible platform for liquidity provision and on-chain trading.

One of the most significant changes in Uniswap v4 is the introduction of hooks, which are contracts that run at various points of a pool’s lifecycle. These hooks allow developers to customize how pools, swaps, fees, and liquidity provider (LP) positions interact.

With hooks, developers can create customized automated market maker (AMM) pools that integrate with v4’s smart contracts. The sky’s the limit, with potential experiments including time-weighted average market makers, dynamic fees based on volatility or other inputs, on-chain limit orders, and more.

Another major change in Uniswap v4 is the introduction of a new singleton contract that holds all pools, providing important gas savings. This eliminates the need to deploy a new contract for every pool, making creating pools and performing multi-pool swaps more efficient.

Early estimates suggest that v4 reduces pool creation gas costs by 99%, making it cheaper to create minimalistic pools that are more affordable to use.

This new feature also brings back support for native ETH, which offers additional gas savings. Furthermore, the new flash accounting system in v4 transfers assets on net balances, providing even more gas savings.

Uniswap Labs strongly believes that core financial infrastructure should be open and transparent and that the community should govern v4 of the Protocol. The code will be released under a Business Source License 1.1, which limits the use of the v4 source code in a commercial or production setting for up to four years.

The Protocol fee mechanism will also be modeled after v3, with governance able to vote to add a Protocol fee to any pool, up to a capped amount.

Featured image from Unsplash, chart from TradingView.com

Ronaldo Marquez

Ronaldo is an experienced crypto enthusiast dedicated to the nascent and ever-evolving industry. With over five years of extensive research and unwavering dedication, he has cultivated a profound interest in the world of cryptocurrencies.

Ronaldo's journey began with a spark of curiosity, which soon transformed into a deep passion for understanding the intricacies of this groundbreaking technology.

Driven by an insatiable thirst for knowledge, Ronaldo has delved into the depths of the crypto space, exploring its various facets, from blockchain fundamentals to market trends and investment strategies. His tireless exploration and commitment to staying up-to-date with the latest developments have granted him a unique perspective on the industry.

One of Ronaldo's defining areas of expertise lies in technical analysis. He firmly believes that studying charts and deciphering price movements provides valuable insights into the market. Ronaldo recognizes that patterns exist within the chaos of crypto charts, and by utilizing technical analysis tools and indicators, he can unlock hidden opportunities and make informed investment decisions. His dedication to mastering this analytical approach has allowed him to navigate the volatile crypto market with confidence and precision.

Ronaldo's commitment to his craft goes beyond personal gain. He is passionate about sharing his knowledge and insights with others, empowering them to make well-informed decisions in the crypto space. Ronaldo's writing is a testament to his dedication, providing readers with meaningful analysis and up-to-date news. He strives to offer a comprehensive understanding of the crypto industry, helping readers navigate its complexities and seize opportunities.

Outside of the crypto realm, Ronaldo enjoys indulging in other passions. As an avid sports fan, he finds joy in watching exhilarating sporting events, witnessing the triumphs and challenges of athletes pushing their limits. Furthermore, His passion for languages extends beyond mere communication; he aspires to master German, French, Italian, and Portuguese, in addition to his native Spanish. Recognizing the value of linguistic proficiency, Ronaldo aims to enhance his work prospects, personal relationships, and overall growth.

However, Ronaldo's aspirations extend far beyond language acquisition. He believes that the future of the crypto industry holds immense potential as a groundbreaking force in history. With unwavering conviction, he envisions a world where cryptocurrencies unlock financial freedom for all and become catalysts for societal development and growth. Ronaldo is determined to prepare himself for this transformative era, ensuring he is well-equipped to navigate the crypto landscape.

Ronaldo also recognizes the importance of maintaining a healthy body and mind, regularly hitting the gym to stay physically fit. He immerses himself in books and podcasts that inspire him to become the best version of himself, constantly seeking new ways to expand his horizons and knowledge.

With a genuine desire to become the best version of himself, Ronaldo is committed to continuous improvement. He sets personal goals, embraces challenges, and seeks opportunities for growth and self-reflection. Ultimately, combining his passion for cryptocurrencies, dedication to learning, and commitment to personal development, Ronaldo aims to go hand-in-hand with the exciting new era that the emerging crypto technology is bringing to the world and societies.

Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.