Decentralized Exchange (DEX) is one of the hottest applications in the DeFi space. Many DEX projects have already launched in the past few years to get a piece of this DeFi cake. One of those is Uniswap, the top lending DEX in the DeFi space in terms of market capital. For now, this article will walk you through all the information about Uniswap, including:
- What is Uniswap? The outstanding features of Uniswap.
- What is UNI Token? All the detailed information about UNI Tokenomics.
- How to mine, buy & store UNI token?
- Is UNI a good investment?
All these information will help you decide whether to invest in UNI Token. Now let's find out!
What is Uniswap?
Uniswap is one of the first fully decentralized exchanges (DEX) built in 2018 on top of the Ethereum blockchain. Uniswap allows users to control their funds and wallets at all times without having to deposit funds to the exchange. To determine the price of each token, Uniswap uses the Automated Market Maker (AMM) system instead of using the Order Book system.
How does Uniswap work?
Using Uniswap is relatively simple as you only need to connect ERC-20, BSC, and other wallets such as Metamask, Coinbase wallet, or Coin98 Wallet to swap tokens. Unlike other centralized exchanges, Uniswap is a DEX that doesn’t require registration. Furthermore, Uniswap offers many available swapping pairs so that users can use them based on their needs.
Uniswap is now striving to protect its throne on the leaderboard of DEXs. Its main competitor is Sushi, which controversially forked from the original code of Uniswap. As a result, Uniswap has published detailed plans to upgrade the platform.
Uniswap has been through three main versions: Uniswap V1, V2, and the latest Uniswap V3. In this article, Uniswap V3 will be our main focus. Uniswap V3 launched a Layer 1 Ethereum main net and a Layer 2 deployment on Optimism to solve the gas fee problem on the Ethereum blockchain. In comparison to prior versions, Uniswap V3 has innovative features that make it the most flexible AMM.
Since the introduction of Uniswap V3, there have been numerous changes in the way how Uniswap works. Moreover, Uniswap has a more user-friendly interface for daily users in the crypto space. Adding liquidity is now much more simple and accessible for everyone.
What is a UNI token?
UNI token is Uniswap's native token, and also a governance token. Governance token means that token holders have the right to vote on decisions for changes and developments of the platform.
UNI holders can have a strong influence on the development decisions through a voting system.
Detailed information about UNI token
UNI Key Metrics
- Token Name: Uniswap;
- Ticker: UNI;
- Blockchain: Ethereum;
- Token Standard: ERC-20;
- Contract: 0x1f9840a85d5af5bf1d1762f925bdaddc4201f984;
- Token type: Governance token;
- Total Supply: 1,000,000,000 UNI;
- Circulating Supply: 632,541,837 UNI;
UNI Token Allocation
- Community: 60%.
- Team: 21.51%.
- Investors: 17.8%.
- Advisors: 0.69%.
UNI Token Release Schedule
The UNI token will be vested according to a 4-years schedule.
- 60% of the UNI token (600,000,000 UNI) goes to the community members.
- 21.51% (212,660,000 UNI) to development members and future employees within a 4- year vesting period.
- 17.8% (180,440,000 UNI) tokens allocated to investors with 4-year vesting.
- 0.69% (6,900,000 UNI) for advisors with 4-year vesting.
UNI Token Use Cases
Governance: Uniswap is a governance token. UNI holders have the right to vote on upgrades and development decisions on Uniswap. Governance is the key function of UNI tokens, which helps the platform become decentralized for the community.
Providing Liquidity: Everyone with ERC-20 tokens including UNI tokens can add liquidity to pools to earn token rewards. Users can buy UNI on Uniswap to provide liquidity to pools that are available with high trading volume.
How to buy UNI tokens
Buy UNI Token on Uniswap
You can buy UNI tokens by swapping other tokens for UNI on Uniswap with Coin98 Extension Wallet.
Buy UNI token on Coin98 Exchange
You can use Coin98 Exchange to swap other tokens for UNI following these simple steps: exchange.coin98.com
Step 1: Connect Coin98 Extension Wallet.
Step 2: Select Uniswap.
Step 3: Choose coin/token for trading:
- Search UNI.
- If the search does not come up, you can paste the contract of UNI into the search box: 0x1f9840a85d5af5bf1d1762f925bdaddc4201f984;
Step 4: Adjust the amount you want to swap.
Step 5: Adjust the gas fee, then click Approve.
Alternatively, you can apply the same steps for Coin98 Wallet to buy or swap UNI. There are also other options to buy, swap or earn tokens:
- DEX: Uniswap, Sushiswap...
- CEX: Binance, Huobi, OKEX...
- Wallets: Metamask, Coinbase Wallet, WalletConnect, etc.
How to store UNI on Coin98 Wallet
Because UNI is an ERC-20 token, you can store UNI on Coin98 Wallet.
Step 1: At the main screen of Coin98 Wallet, click Receive.
Step 2: Search for Uniswap token.
Step 3: Choose the blockchain (Ethereum, BSC, Solana, ..etc) depending on your need.
Step 4: Copy your UNI wallet address and send UNI tokens to this address.
Uniswap V1 was launched by Uniswap founder Hayden Adams in November 2018. Followed by the release of its upgraded version UniSwap V2 in 2020.
In May 2021, Uniswap released Uniswap V3 with a new whitepaper. Many critical changes have been done to provide Uniswap users a seamless experience. However, due to the Ethereum congestion, Uniswap is struggling to become the most efficient AMM DEX ever.
Team, Investors, and Partners
Hayden Adams is the founder & CEO of Uniswap. He’s a former mechanical engineer at Siemens.
- Noah Zinsmeister is the Engineering Lead at Uniswap.
- Matteo Leibowitz is the Strategy Lead at Uniswap.
- An undisclosed investment round in 2019 led by Paradigm and other investors. It's said they invested less than $5M which might be worth almost a billion USD in today's price.
- $11M in a Series A Investment Round In July 2020 Led by Andreessen Horowitz with other VCs: USV, Paradigm, Version One, Variant, Parafi Capital, SV Angel, and A.Capital.
Uniswap has yielded to early investors a huge fortune. Currently, the ATH market cap of UNI was $20B, we can imagine how big the return of the investment is.
Uniswap is now the largest decentralized exchange in the world of DeFi in terms of market share. They have many ongoing partnerships with big organizations and other crypto exchanges.
Recently, Uniswap has formed a long-term partnership with a European Esport Team called Team Secret. Team Secret will create more new and innovative content for the popularity expansion of Uniswap.
Along with Uniswap, Team Secret also has formed profoundly strategic partnerships with several tech companies. They all share an ultimate goal to broadcast the adoption of blockchain technology into mainstream media as well as young digital audiences.
Is UNI a good investment?
Uniswap has an incredibly bullish performance in the 2021 bull run market. Uniswap is now a leading decentralized exchange, however, there has been a critical correction in the price of UNI. Since the launch of Uniswap V3, Uniswap has added many new features to the Uniswap platform. Uniswap is now dominating the DEX market share.
The DEX is now live on Ethereum, Polygon, Arbitrum, and Optimism. Unlike the beginning of 2021, it was only live on Ethereum, later in that year, Uniswap announced the Layer-2 integration to its platform, marking a new milestone for the development growth.
We can see the misalignment among Ethereum and other L2 scaling solutions. Uniswap seems to be outperformed on other L2 chains by other protocols as well as L2-native protocols. The DEX users and Liquidity Providers still find it unattractive to move their assets to L2 solutions via bridges. If Uniswap can migrate its user base and "lazy" liquidity to L2, it will be a particularly strong strategic move.
To realize the great migration, Uniswap bridges should operate in a proper way as the crypto bridges potentially contain risks of exploits and hacks.
There are several key points that you should consider before making any investment decisions:
- Uniswap is now on top of the leaderboard in the DEX market with up to $500 million dollars in daily trading volume. They migrated to three scaling solutions which are the most reputable ones in crypto. We will see more and more DeFi veterans move to the L2 land and Uniswap should accelerate the growth.
- The V3 upgrade of Uniswap has improved the capability of capital utilization which is up to 4,000 times more efficiently than Uniswap V2. As an AMM DEX with the cutting-edge and leading technique of liquidity utilization, Uniswap released V3 and still maintains the edge. However, in the long term, Uniswap can't stand by the pavement and see other thrives since the crypto game is a little different now.
- The Uniswap community is an advantage for investing because they have half a million followers on Twitter. Trading and investing are becoming popular in society, especially in the Covid-19 pandemic. Many have lost their daily jobs and they have to adapt to the new situation.
- Uniswap has been through 3 major upgrades which means that Uniswap Labs is capable of developing the platform to become better and solving current problems.
- Another strong but simple moat of Uniswap is DEX-focused as the team is improving the platform every day. In the maze of DEX and potential exploits, Uniswap users have experienced no such things. It's hard to find reliable DeFi protocols nowadays, but Uniswap is easy to be found.
Uniswap not only provides users with the swapping service but also has an ecosystem of various products.
As mentioned above, Uniswap has a huge potential to contribute to the world of DeFi. It is said to be profitable in the long term. The UNI token is tied to the future development of the Uniswap platform.
Besides Uniswap, there are numerous other DEXs in the crypto market. However, Uniswap is still on top of the DEX leaderboard.
- Pancakeswap: Pancakeswap is a decentralized exchange built on BSC for swapping BEP20 tokens.
- Sushiswap: Sushiswap is a fork from Uniswap for the sake of the community’s benefit.
- MDEX: MDEX is an Automated Market Maker (AMM) DEX based on the concept of fund pools. MDEX is built on Heco Chain and Ethereum.
- 1inch Exchange: 1inch Exchange is a DEX aggregator with smart routing.
Overall, Uniswap was a shooting star at the beginning of 2021 which led the DEX market in terms of capital. It offers a wide range of swapping pairs as well as several other DeFi services. By becoming a crypto giant in DeFi space, Uniswap has a user-friendly interface that appeals to lots of newcomers in the crypto space.
In addition, the UNI token is a native governance token that gives users rights over new upgrade decisions. For example, transaction fee reduction on Uniswap. In the long run, Uniswap can still manage to maintain the strong moat.
You’ve been through an article about Uniswap and the UNI token. I hope it has helped you in gaining more useful insight into this project and understanding its potential.