Uniswap, the decentralized exchange running on multiple blockchains, but mainly Ethereum and its layer-2, shaped decentralized finance (DeFi).
The first iteration of the exchange launched in late 2018, at the depth of the 2018 bear run where Ethereum and its tokens had been obliterated.
While prices were down, the release of Uniswap ignited the fire that eventually grew to command over $150 billion in DeFi.
Uniswap TVL Rises To $5.5 Billion, Will UNI Rise?
The DEX has since grown by leaps and bounds. According to DefiLlama, Uniswap commands a total value locked (TVL) of over $4.7 billion. Most of its assets are locked in Ethereum, but there is a bigger chunk in Arbitrum and Optimism.
Although Uniswap didn’t launch a token from the start, it was not until 2021 that the team released UNI, the governance token, starving off a vampire attack from the more aggressive SushiSwap.
After launch, a small portion was distributed to active users, and UNI rose, peaking at over $40 in 2021.
Three years later, prices have corrected and the token is struggling against bears.
While there have been flashes of strength, UNI is flat, capped below $7.2, and sellers have the upper hand.
Despite the current stagnation, UNI holders are upbeat and confident that prices will soon edge higher, even closing above $20 in the coming sessions.
Several factors underpin this positive sentiment. Though UNI might benefit from favorable market conditions, key tailwinds are those from in-house developments and expected upgrades.
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Uniswap To Ride The Tide?
The decision by the Federal Open Market Committee (FOMC) to slash rates has had a positive impact on sentiment, boosting ETH prices.
As ETH prints higher, closing above $2,400, market experts project its ecosystem tokens, including UNI and other DeFi coins, will benefit from this positive influence, thanks partly to the positive correlation.
Enhancing User Experience
This momentum will be further fanned by Uniswap’s dedication to enhancing user experience. Recently, the protocol released the mobile version of the DEX that protects traders against Maximum Extractable Value (MEV) bots.
It’s a chess move. With this feature, all traders will swap safely, aware that bots can’t initiate front-running and sandwich attacks–two vulnerabilities that continue to plague DEX trading.
Beyond this, Uniswap users can now fund their wallets directly from centralized exchanges like Binance.
https://x.com/Uniswap/status/1837886323333472392
This feature was coming. Their research reveals that 65% of its users purchased crypto on a CEX before moving them to Uniswap for trading. DEX users can now move coins from their favorite exchanges to Uniswap.
Beyond these protocol feature upgrades, Uniswap also announced support for cbBTC, the recently launched wrapped Bitcoin by Coinbase. As of September 25, users can benefit from the integration of cbBTC liquidity pools on the Ethereum mainnet and Base, a layer-2 backed by Coinbase.
Massive Demand On Arbitrum
Uniswap’s continuous enhancements appear to be paying off ahead of the scheduled launch of Uniswap v4.
Dune Analytics data shows that nearly $200 billion in Uniswap trading volume has been recorded on Arbitrum.
This will be a massive milestone for Uniswap and Arbitrum, reflecting the growing demand for scalable and low-cost DeFi swaps.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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