In recent years, cryptocurrency has become the most popular topic in the whole world. Each second, the value of cryptocurrencies fluctuates. A few exchanges are in place to facilitate the trading of cryptocurrencies, one of them is Uniswap. Centralized exchanges such as Binance, Coinbase, Huobi Global, and others are available. There are several decentralized exchanges, including Uniswap, Tokenlon, Venus, and Sushiswap.
What is Uniswap?
Why did Uniswap come into existence?
History of Uniswap
Is it a good decision to invest in Uniswap?
Reasons to invest in Uniswap
How does Uniswap work?
How to invest in Uniswap in India?
Conclusion: Uniswap
Uniswap: FAQs
What is Uniswap?
Uniswap is a decentralized protocol, used for exchanging cryptocurrencies. It is a trending decentralized exchange which means that no manual control exists in it. All operations are done through smart contracts which mean that there is an agreement between the buyer and seller directly in computer codes. Uniswap works on Ethereum blockchain provisions. Since, it is decentralized; it facilitates automated transactions and is free from any sort of hacking risks.
Uniswap was initially created as a trustless, decentralized financial exchange or DEX, that allowed anyone to be a part of financial transactions of Ethereum-based tokens, without any intermediary, middle-man or a central-body. Uniswap aims at giving permission less access of financial services to its users in a secured and immutable way. It is free from any sort of discrimination or counterparty risk.
Since it uses technologies such as, the Ethereum blockchain and smart contracts, Uniswap has replaced conventional centralized market tools like exchange listings and limit-order books with automated and permission less liquidity pools executed solely by algorithms. The crypto assets that facilitate the trading of trading pairs on decentralized exchange are called liquidity pools. On Uniswap, liquidity pools are pairs of ETH and ERC-tokens, which are swapped and exchanged by traders. Popular liquidity pools include ETH and Wrapped Bitcoins (WBTC), ETH and DAI, ETH and USDT, and ETH and USDC.
Participants who add assets to these pools are called liquidity providers or LPs, who earn a proportion of transaction fees for their contribution. For this, you need to connect an Ethereum-based wallet like metamask. You simply need to deposit your Ethereum tokens into a shared liquidity pool on Uniswap and get started in no time!
Purbalee Dutta
Why did Uniswap come into existence?
Uniswap was brought in the market to tackle a few toughest issues prevailing in the market such as power and control that had been captured by the major centralized exchanges – Binance and Coinbase. Uniswap came up with decentralized characteristic that resolved the problem. Also, Uniswap plays a significant role in providing fresh businesses access to global liquidity.
History of Uniswap
The story of the trending Uniswap (UNI) has its roots in 2016. Vitalik Buterin, the founder of Ethereum, came up with the idea of a completely decentralized market maker. But, only a year before, a well-known crypto-developer, Hayden Adam took up the project and converted that idea into reality along with a few ETH community.
Uniswap plays a vital role in the market and has been a shooting star since its arrival. Uniswap has continuously been growing and has gained even more value and popularity in past years because of a recent explosion in DeFi platform. You will be surprised to see the graph of the coin. It was within a year of its arrival, the coin got listed in 2020 and was at a good rank. It has been growing since the time it has been listed. It had become the first choice of various investors.
The decentralized token exchange has been gaining heights while at quite a young stage, Uniswap has been grabbing a lot of attention from the investors.
Annika Motamarri
Is it a good decision to invest in Uniswap?
Having a glance at the amazing past of Uniswap it is likely, that it has a great future as well. However, this forecast is subject to the volatile nature of the crypto markets. The price predictions and visible growth can not be the sole criteria for buying it.
Digitalcoinprice
The experts of Digitalcoinprice believe that Uniswap will be a successful long term investment. They assume that the price will triple itself and rise to around 30 US dollars as early as 2021. In the coming two years, this trend is likely to continue and the value of the token is expected to increase by 40 percent. Digitalcoinprice forecasts a price of $52.47 by 2024. Finally, by 2025, Uniswap is predicted to have its price more than triple which would be about 62 US dollars.
Walletinvestor
Walletinvestor, another investment expert website expect that not only the price of Uniswap would double itself to over 40 US, but also the token’s value is likely to continue this trend in the following year. In 2023, it forecasts a comparatively slow rise to just over 100 US dollars. A year later, the price is expected to rise again by 28.5%, to about 135 US dollars. Finally, the experts predict a price of 166.04 US dollars by 2025.
CoinPedia
CoinPedia compares the forecasts of other experts with its own analyzed results and draws the conclusion that the price of the Uniswap token is expected to gain a sharp rise. It says that a price of about $35 could be seen for 2021. Following, a secured price rise in the years to come. Coinpedia believes that investment in Uniswap is good for long-term investors.
To sum up, Experts guess that the Uniswap is a good opportunity for investment as coin Market Cap is consistently increasing which means that People are constantly investing in this coin.
Sarika Anand
Reasons to invest in Uniswap
It is true that, Uniswap has been beneficial for the users and the market as a whole, since its arrival. It has a crystal clear working process based on a simplified interface. It has gained stardom for many reasons-
Flexible
The entire network of Uniswap is extremely flexible because of its characteristics. One can easily execute trades with a click due to its open nature and a basic trading window. Anybody looking forward to swap two Ethereum assets can easily do that on this network.
Non-discrimination
Uniswap being a decentralized protocol, has no central authority to block users and seize their funds. There is no supervision on you even if you have traded too much or what companies you are investing in. It’s flexible, global decentralized market that offers equal access to all.
Security
Uniswap is an open-source protocol that has gone through a stern review by the development community. The smart contract coding is secured and the platform is non-custodial, so hackers gain no profits from attacking it. But, you still need to be cautious of rug pulls and scamsters as the digital world is very unpredictable as well.
Decentralized exchanges provide you with comparatively more privacy protection options than centralized exchanges. These protocols are permission less and need no KYC (know your customer). Uniswap allows you to trade freely without having to register and log in to the market.
Compatible
Uniswap complies with the requisites of ERC-20 token standards. The platform backs-up third-party API integrations. These protocols provide the participants the ability to make use of outside tools in their trading strategies. Currently, there are multiple third-party interfaces, trading bots, and market management tools built to perk up Uniswap’s UX.
Alan Joseph
How does Uniswap work?
Uniswap works on Ethereum blockchain provisions and smart contracts technology. It facilitates secured financial transactions and uses contemporary market tools. We first need to understand the working of centralized exchanges like CoinBase for clear understanding of how Uniswap works. Centralized Exchanges allow easy trade through a traditional order book-based model. It is a platform where orders are listed along with the amount. A buy order and a sell order are matched with the same price and vice versa.
To understand it better, here is an instance-
Let’s say, Mr. A wants to sell one Ethereum token for $3,000 on CoinBase. The offer placed by him will now be matched with another participant who is looking to buy that amount of ETH for same price.
Uniswap works on the model called ‘Automated Liquidity Protocol’ that does not solely rely on its participants for liquidity creation. This model works on a mathematical equation that determines the value of tokens as per the prevailing demand itself. It becomes easy to add any token to the Uniswap protocol by funding it with the same value of Ethereum as that of the token being traded.
Now, instead of finding the match, a constant equation of x*y=k will be applied. Where,
x represents the amount of Ethereum;
y represents the currently active ERC-tokens in the liquidity pool and;
k is a constant value.
How to invest in Uniswap in India?
1. Decide how many Uniswap you wish to purchase by taking a look at the current market price.
2. Place an order using your broker’s platform.
3. Wait for your broker to fill your order as per your specifications.
4. You will receive a notification by email if your order is filled or cancelled.
Alan Joseph
Conclusion: Uniswap
If you trust the decentralized finance industry, investment in Uniswap is a great option for you in a longer run. Since day one of its arrival, Uniswap has boosted large scale cryptocurrency adoption. A bunch of DEXs have even copied the uniqueness of its platform’s strategy.
Uniswap: FAQs
What is Uniswap?
Uniswap is a decentralized protocol, used for exchanging cryptocurrencies.
What was the reason behind starting Uniswap?
Uniswap was brought in the market to tackle a few toughest issues prevailing in the market such as power and control that had been captured by the major centralized exchanges.
What does Experts say about Uniswap?
Experts guess that the Uniswap is a good opportunity for investment as coin Market Cap is consistently increasing which means that People are constantly investing in this coin.
What are the reasons to invest in Uniswap?
The main reasons are, Uniswap is flexible, non-discriminatory, provides security and it is compatible.
How does Uniswap work?
Uniswap works on Ethereum blockchain provisions and smart contracts technology.
Author: Shruti Kasera
Source : https://startuptalky.com/uniswap-cryptocurrency-analysis/
Date : 2021-07-01T19:23:18.000Z