Uniswap Labs, a leader in the DeFi space, has announced the release of Uniswap v4, a new protocol version.
Uniswap v4 aims to revolutionize the Decentralized Finance (DeFi) sector by introducing new and improved features on the protocol. This also reduces gas costs and makes liquidity pools more customizable.
Launched by the broader Uniswap developer ecosystem, the v4 upgrade offers long-term implications for the ecosystem’s native token, UNI ($11.41)
Newly Added Features Highlight
The v4 upgrade is an improvement from the earlier Uniswap v3 protocol.
It transitions the Uniswap Protocol into a developer platform by introducing additional features like hooks, native Ethereum support, and a “flash accounting” system.
Source: XHooks are described as customizable smart contracts that give users unlimited customization.
Hooks allow users to customize how pools, swaps, fees, and LP positions interact.
This feature creates new opportunities for crypto startups and traditional financial institutions to experiment and deliver DeFi innovation.
Uniswap V4 also introduces the Singleton contract, consolidating all token pairs into a single smart contract.
Singleton’s contract will considerably lower gas fees by removing unnecessary gas expenses associated with traditional pool building.
According to Uniswap Labs, the v4 is the lowest-cost version of the protocol available to date. Creating new pools on the v4 protocol is about 99.99% cheaper than in previous versions.
Also, swappers can expect to see huge savings on multi-hop swaps.
Furthermore, Uniswap v4 reintroduces native ETH ($3,230.99) in trading pairs. These pairs were temporarily removed in v2 due to implementation complexity and concerns over liquidity fragmentation.
However, the native ETH support adds substantial savings for ETH pairs.
The Uniswap Unichain Pivot
Importantly, v4 underwent nine independent audits, a security competition, and a $15.5M bug bounty. No major vulnerabilities were discovered in all these, reinforcing the protocol’s advanced onchain security.
The v4 protocol launch follows the announcement of Uniswap’s Unichain, a DeFi-based Ethereum Layer-2 solution.
Built on the Superchain, Unichain represents a transition from Ethereum’s high transaction costs.
Uniswap aims to reduce transaction costs by as much as 95% by moving execution to Layer 2.
Also, Unichain will improve speed through its one-second block times to boost market efficiency.
The Unichain Sepolia testnet garnered an enormous response following its October 2024 launch.
The testnet handled 50 million test transactions and over 4 million test contracts. As a result, the platform’s team is working to build Unichain’s public mainnet.
Uniswap (UNI) Price, Current Outlook, and Future Forecast
The UNI token reacts positively to the Uniswap v4 upgrade announcement and the Unichain pivot.
As of this writing, UNI price was trading at $12.38, up 2.25% in the last 24 hours. UNI traded as high as $12.8 on the daily chart before dropping to current levels.
The ongoing momentum in the ecosystem has pushed the market cap to $7.43 billion.
According to technical indicators, the current sentiment is Neutral, while the Fear & Greed Index shows Extreme Greed at 76.
The market prediction for UNI in February suggests the token will increase by about 5.36%. This forecast establishes an average price of $ 12.98 for the month.
The projected price fluctuation ranges from $11.71 to $16.15. This trend may result in a 31.06% return from the current price.
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