About Uniswap (UNI/USD)
Uniswap is a protocol for exchanging tokens on Ethereum without an order book. Traditional exchanges match a buyer against a seller; Uniswap instead holds pools of two tokens and prices trades by a formula, so that buying one side of a pool raises its price and selling lowers it. Anyone can deposit into a pool and earn a share of the trading fees. This design β an automated market maker β removed the need for market makers, listings and counterparties, and is the reason a token can trade within minutes of being created.
The protocol launched in 2018 and went through successive versions, the most consequential of which allowed liquidity providers to concentrate their capital within a chosen price range rather than spreading it across every possible price. That made provision far more capital-efficient and considerably more demanding to do well.
UNI is a governance token, distributed to past users of the protocol in September 2020. It confers votes over the protocol’s treasury and parameters. It is worth being precise about what it does not confer: holding UNI is not a claim on trading fees. Whether, and how, fees should accrue to token holders has been among the most persistent debates in the protocol’s governance.
What Moves Uniswap?
Trading volume through the protocol
Volume drives fees earned by liquidity providers, and is the clearest measure of whether the protocol is being used.
Governance decisions on fees
Proposals affecting whether protocol fees are switched on, and where they go, bear directly on what the token represents. This is the single most-watched governance question.
Competition among exchanges
Uniswap competes with other decentralised exchanges, with aggregators that route across several, and with centralised venues. Deployments to additional networks extend its reach but also fragment liquidity.
Regulatory treatment of decentralised exchanges
How regulators treat protocols that match trades without holding customer assets is an unresolved question in several jurisdictions, and one that applies to this asset more directly than to most.
Trading Uniswap (UNI/USD)
Uniswap trades continuously, and the price on this page comes from our own market feed. Nothing here is a recommendation or a forecast; see our methodology.
