Uniswap, one of the largest decentralized exchange platforms, has officially announced that it is launching V4 to improve various aspects like liquidity and gas savings. Before publicly launching the next iteration of the platform, it is asking for community feedback, which demonstrates its commitment to the decentralized future.
Reduced Costs and Improved Efficiency with “Hooks”
Uniswap’s announcement acknowledged the success of its previous version V3 in improving trading liquidity. And, also addressed the increased costs that came along with it.
With the new V4 version, the team is introducing contracts called “Hooks” which add new functionality to the DEX. As a result, V4 will allow pools with dynamic fees, on-chain limit orders, and time-weighted average market makers to spread out large orders over time.
Uniswap V4 is also going to introduce customized pools with different kinds of swaps, fees, and LP positions with its “Hooks” plugins. Now, unlike the previous versions, each pool is different from the other and it is limited to specific permissions that are defined at the pool creation.
As per the announcements, they estimated that V4 could reduce pool creation gas costs by 99%. This is expected to be possible because the new version is going to use a singleton contract for all the pools, unlike Uniswap V3.
Along with this improved architecture, the team is also introducing a “flash accounting system”. Instead of transferring the assets at the end of every swap in V3, this new system is going to transfer only on net balances, thus improving efficiency.
Whale Accumulates $3.7 Million UNI Tokens After the Announcement
As per the tweet from the Lookonchain data tracker, Wintermute Trading has accumulated 878,336 UNI tokens which are worth around $4 million.
After the big announcement from Uniswap Labs, Wintermute Trading has accumulated these tokens from several centralized exchange platforms. Binance, Kraken, and OKX are a few of the exchange platforms among others.
This big whale move has created a bullish sentiment on UNI among the community, with several accounts replying to the tweet that Uniswap is a promising project. Though the project has not yet publicly released the V4 version, this cannot stop buyers from capitalizing on the hype and on its bullish sentiment.
Meanwhile, DEX trading volume is surging because of SEC’s increased focus on centralized exchanges like Binance and Coinbase. According to the data from DeFiLlama, DEX trading volume has significantly increased from $1.21 billion to around $4 billion in just the first week of June this year. However, the total volume in 24 hour period is $2.2 billion as of June 15, 2023.
Another report by CCData also proved that the market share of decentralized platforms is increasing every month and reached an ATH of around 13%. The announcement from Uniswap Labs about V4 launch could further increase the usage and trading volumes of DEX platforms.
