How does Uniswap Exchange operate?
Uniswap is a Decentralized exchange that is developed on the Ethereum Blockchain network. it is a decentralized protocol that doesn’t have a native token
Today's Technology is moving towards decentralization. In this decentralized world, you need no intermediate or middleman to help with trading. More Blockchain developers are involved in creating a decentralized exchange which is equivalent to a centralized exchange. There are many decentralized exchange protocols are available in a decentralized world. One of the popular DEX platforms is Uniswap.
What is Uniswap?
Uniswap is a Decentralized exchange that is developed on the Ethereum Blockchain network. This Uniswap has an automated liquidity protocol, and no order book or any centralized exchange is needed to accomplish trades. Uniswap permits users to trade without representatives, with a high level of decentralization.
Uniswap works with the model that includes liquidity providers formulating liquidity pools. This system implements a decentralized pricing mechanism that really flattens out order book extent. Uniswap enables the users to swap ERC-20 tokens without depending upon an order book. Uniswap protocol is decentralized, with no listing process. ERC-20 token can be originated as there is a liquidity pool available for traders. Uniswap doesn’t charge any listing fees.
How does Uniswap make money?
Uniswap is a decentralized protocol that doesn’t have a native token. All fees are given to liquidity providers, and no trading charge is exerted by the founder in the protocol. It charges 0.3% per trade, and it is endeavored to the liquidity providers. By default, these are appended to the liquidity pool, which liquidity providers can obtain at any time. The fees are allocated to the liquidity providers according to their share of the pool. A part of the fees may be implemented to Uniswap development in the eternity.
The Uniswap (UNI) token
UNI is the native token of the Uniswap protocol, and it empowers its holders to governance priorities. It supports the UNI holders to vote on the protocol.
1 billion UNI tokens have been invented. 60% of tokens are allocated among existing Uniswap community members, while 40% will be made possible to team members, investors, and advisors over four years.
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