{"id":460829,"date":"2021-04-08T21:07:30","date_gmt":"2021-04-08T21:07:30","guid":{"rendered":"https:\/\/uniquehot.com\/?p=460829"},"modified":"2021-04-08T21:10:22","modified_gmt":"2021-04-08T21:10:22","slug":"this-is-why-uniswap-v3-could-have-insane-efficiency","status":"publish","type":"post","link":"https:\/\/uniquehot.com\/news\/this-is-why-uniswap-v3-could-have-insane-efficiency\/","title":{"rendered":"This is why Uniswap v3 could have \u201cinsane efficiency\u201d"},"content":{"rendered":"
With a tentative deployment date set for May 5th<\/sup>, 2021, the third iteration of decentralized exchange Uniswap is amongst the most hype projects<\/a> in the crypto space. Its newest features offer its user more flexibility to leverage earning strategies.<\/p>\n However, the creator of Uniswap, Hayden Adams, claims there is much more to the update. Via his Twitter account, he showed the DEX\u2019s new equation to calculate efficiency and said<\/a>:<\/p>\n I don’t think the insane efficiency of Uniswap v3 has sunk in yet. Over the past 3 months (Jan8-present) the price of ETH\/BTC has ranged from 0.0295 to 0.0454 Plugging into the formula, we find it is 9.8x more efficient than v2.<\/p><\/blockquote>\n Comparing the second to the soon-to-launch iteration of Uniswap, Adams highlighted other advantages for the users, like the reduction in the amount of capital required to provide liquidity.<\/p>\n The liquidity providers (LP) will also be able to participate in a specific range for a trading pair to receive trading fees with the \u201csame amount of impermanent loss\u201d. Adams added the following example:<\/p>\n the Uniswap v2 WBTC\/ETH pair has $318m in it. If WBTC\/ETH LPs instead provided to the range of 0.0295 and 0.0454 on v3 they could create the same amount of liquidity and take on the same amount of impermanent loss with just 318\/9.8 = $32m.<\/p><\/blockquote>\n In a post<\/a> title \u201cThe Dex to Rule Them All\u201d, researcher Will Sheehan\u201d, go deeper into Uniswap v3.<\/a> Claiming that this update will \u201cchange\u201d the dynamics in active and passive LP. Therefore, minimizing and creating a better balance between all the users. \u00a0Adam added:<\/p>\n Efficiency is just a means to an end – the result of concentrated liquidity is offering far better execution rates and giving LPs more desirable positions. How much better will they be once v3 is live? These things can be hard to predict. But i have a good feeling.<\/p><\/blockquote>\n UNI is trading at $29,62 with 3.4% gains in the daily chart. Over the week, the governance token has 5.6% gains and 11.5% losses in the monthly chart. With over $15 billion in total market cap, UNI managed to break into the top 10, surpassing Litecoin and Chainlink.<\/p>\nUniswap v3 will be over 10x more efficient<\/strong><\/h2>\n