What is UNISWAP (UNI)?
Photo Credits: DepositPhotos
Uniswap is a popular protocol for decentralized trading, known for its role in enabling automated trading of tokens for decentralized finance (DeFi).
An example of an automated market maker (AMM), Uniswap was launched in November 2018, but gained significant popularity this year thanks to the DeFi phenomenon and the associated increase in token trading.
Uniswap aims to keep token trading automated and fully open to anyone who holds tokens, while at the same time improving the efficiency of trading compared to that on traditional stock exchanges.
Uniswap creates greater efficiency by solving liquidity problems with the help of automated solutions, avoiding the problems that plagued the first decentralized stock exchanges.In September 2020, Uniswap went a step further by creating and assigning its own UNI management token to former protocol users. It has also added the potential for profitability and the ability of users to shape its future - an attractive aspect of decentralized entities.Who are the founders of Uniswap?
Uniswap was created as a plan to present AMMs at Ethereum to a wider audience. The creator of the platform is Ethereum developer Haiden Adams. Adams worked on various projects while finalizing UniSWap, and his work was directly informed by Ethereum creator Vitalik Buterin. Buterin even eventually gave the protocol its name - it was originally known as Unipeg.
AdaOne of Buterin’s blog posts inspired Adams to create Uniswap. His original idea to focus on Ethereum came after a friend convinced him to start researching and understanding protocols in 2017.What makes Uniswap unique?
Uniswap exists to create liquidity - and thus trading and the value that trading provides - for the DeFi sphere. One of the main AMMs currently working, the protocol works using an automated exchange formula - Ks k I = K. Founder Hayden Adams describes himself as the inventor of a specific application of the formula on Uniswap.
Uniswap is not just a decentralized exchange; tries to solve problems with platforms such as EtherDelta with liquidity.
By automating the market-making process, the protocol encourages activity by limiting risk and reducing costs for all parties. The mechanism also removes user identity requirements, and technically anyone can create a pool of liquidity for any pair of tokens.
On the Uniswap site, you can see how to become part of their community. It's always good to be part of the community before you invest.