Uniswap is a crypto asset that can be used as an investment instrument. Currently, there are many investment options as a result of the increasingly advanced technology development.
One of the most talked about investment instruments currently is crypto assets. With advanced technology, many crypto assets have become the preferred investment tool for people both nationally and globally.
The one that is currently rising in popularity is Uniswap. What is it and how does it work? Check out the following review.
What is Uniswap?
Uniswap is a decentralized exchange protocol on the Ethereum blockchain network. This platform allows peer-to-peer (P2P) crypto asset trading without a centralized order book/middleman.
It is possible because the Uniswap platform has a liquidity pool model that uses automated smart contracts to enable potential traders to access competitive user-funded token reserves as the primary source of market liquidity.
In this platform, anyone can exchange tokens, donate tokens to the pool and earn fees, and register their tokens.
Given that Uniswap is built on the Ethereum network, almost all ERC-20 tokens can be exchanged for Uniswap. In addition, there is also no registration fee for the tokens available for trading on Uniswap.
Who Invented Uniswap?
So, who invented Uniswap?
Referring to historical records, Uniswap was created by Hayden Adams. He was inspired by Vitalik Buterin—the founder of Ethereum to create a postal protocol.
In 2018, Uniswap was created on the Ethereum blockchain network. For information, Ethereum is the second largest crypto asset project in the world by market capitalization.
This in turn makes it compatible with all ERC-20 tokens and infrastructures, for example wallet services such as MetaMask or MyEtherWallet.
What Makes Uniswap Unique?
There are several things that make Uniswap unique.
First, unlike other exchanges that are designed to charge fees, Uniswap is a decentralized exchange (DEX) designed to trade tokens to users without any platform/middleman fees.
Second, Uniswap uses simple mathematical equations, token pools, and ETH when matching buyers and sellers to determine prices and make trading transactions.
Third, Uniswap is fully open source so anyone can copy the code to create their own decentralized exchange. Uniswap even allows users to register tokens through this exchange for free.
The Uniswap is a decentralized protocol so there is no listing process here. In summary, ERC-20 tokens can be launched as long as there is a liquidity pool available to traders.
Therefore, Uniswap does not charge a listing fee, which can also mean that this protocol acts as a public tool.
How Uniswap Works?
The main innovation that makes this protocol work is the automated market maker technology (AMM) or smart contracts that manage the Uniswap pool which provides tokens that are used to carry out trades.
When a trade occurs, the Uniswap AMM algorithm will determine the effective price of the token according to the supply and demand dynamics among the tokens involved in the liquidity pool.
When a user trades with the Uniswap liquidity pool, the platform will charge a transaction fee of 0.3%. Each user who contributes to the liquidity pool will receive a chunk of the fee in proportion to the staked share of the entire pool.
As illustration, if the fees collected in a certain market are equivalent to $100 and you provide 50% of the liquidity pool then you will receive $50.
As mentioned above, Uniswap does not charge any transaction fees on its platform. Instead, the profits will be distributed only among the Uniswap user community.
How to Get Uniswap (UNI)
Basically, there are several ways to get Uniswap (UNI). For those of you who are interested in obtaining UNI assets easily, you can now buy them through Indodax.
Purchasing UNI assets on Indodax will be more practical if you want to get UNI quickly. You can also check the latest Uniswap prices (UNI/IDR) on the Indodax market.
The following is a guide on how to buy Uniswap (UNI) on Indodax.
- For those of you who are not yet a member, please click this link.
- Next, make a deposit.
- If you have deposited and you have the balance, you can then return to the market.
- Search for Uniswap (UNI) in the Rupiah market, then click.
- To buy, fill in the balance and at what price you want to buy Uniswap (UNI). You can also buy it instantly or directly at the current price.
- Next, you need to patiently wait for the price to increase.
- After the price increases, you can sell it at a higher price with the instant method.
- If you sell using the limit method, you can place orders after buying. Make sure you have entered a higher number when selling.
That’s a complete review of Uniswap, a crypto asset that is currently on the rise. Let’s check out other recent articles and reviews of digital asset investment only at Indodax Academy.
