UniswapX, a cross-AMM protocol, is launched by Uniswap.
UniswapX, a cross-AMM protocol, is launched by Uniswap.
Uniswap Unveils Blockchain Protocol “UniswapX” for Automated Market Makers (AMMs)
Uniswap, the world’s largest decentralized crypto exchange, has announced the launch of a new blockchain protocol called “UniswapX.” This protocol aims to improve trading across automated market makers (AMMs) and other liquidity sources. UniswapX addresses several pain points of on-chain trading and self-custody swapping, including better prices, gas-free swapping, protection against maximal extractable value (MEV), and no cost for failed transactions.
The Need for UniswapX
For traders, liquidity pools are essential for executing trades on decentralized exchanges (DEXs) like Uniswap. However, these pools can sometimes experience a lack of liquidity. UniswapX aims to solve this problem by engaging with third-party fillers that fill swaps directly or route users to appropriate AMM pools. These fillers compete with Uniswap, driving down prices for traders and ensuring better prices.
Additionally, UniswapX eliminates the need for swappers to own a blockchain’s native network token, such as ETH or MATIC, to participate in trading. Fillers cover the gas fees on behalf of swappers, removing any financial responsibility for unsuccessful transactions. By incorporating gas fees into overall swap prices and aggregating multiple orders, fillers foster a competitive environment for achieving the most favorable price.
Thwarting Maximal Extractable Value (MEV)
One significant concern for swappers is MEV, a scheme where network operators capitalize on their ability to preview queued transactions. UniswapX addresses this issue by redirecting MEV that would otherwise be seized by arbitrage transactions and sandwich attacks. It encourages fillers to use private transaction relays, keeping transactions out of sight of MEV bots.
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Future Expansion of UniswapX
Uniswap is launching UniswapX in “opt-in beta” on the Uniswap Labs interface for the main Ethereum network. The company plans to expand UniswapX to other chains and the Uniswap wallet in the near future. Although a final version release date has not been announced yet, the introduction of UniswapX promises to enhance the trading experience for users by addressing liquidity issues, reducing costs, and protecting against MEV.
In summary, UniswapX is an innovative blockchain protocol developed by Uniswap to improve trading across automated market makers and liquidity sources. By engaging with third-party fillers, UniswapX ensures better prices, gas-free swapping, and protection against MEV. This protocol not only addresses the pain points of on-chain trading but also fosters a competitive environment for achieving the most favorable price. With future expansion plans, UniswapX is set to revolutionize the decentralized exchange landscape.
