Uniswap is constantly evolving, and each new version brings important innovations that improve the protocol's efficiency and functionality.
Uniswap V1 (November 2018):
Summary: The first version of the protocol that introduced the concept of AMM and liquidity pools.
Limitation: Each liquidity pool was tied to ETH (e.g., WETH-DAI), requiring additional swaps to exchange between two other tokens (e.g., DAI-USDC).
Uniswap V2 (May 2020):
Summary: An improved version that allowed the creation of liquidity pools for any two ERC-20 tokens (e.g., DAI-USDC), significantly enhancing trading efficiency.
New Features:
Price Oracles: V2 introduced a mechanism that allowed dApps to obtain reliable price data.
Flash Swaps: The ability to borrow assets without collateral as long as they are returned in the same transaction.
Protocol Fee: A "switch" was added that allowed a small fee to be charged, which could be directed to the protocol's treasury.
Uniswap V3 (May 2021):
Summary: The most revolutionary version that introduced the concept of "Concentrated Liquidity."
Concentrated Liquidity: LPs can now place their capital in a specific price range instead of spreading it evenly across the spectrum.
Advantages: This leads to much higher capital efficiency for LPs and deeper liquidity in active price ranges.
Disadvantages: Requires more active management from LPs, as they need to move their positions when the price moves outside their range.
Multiple Fee Tiers: V3 introduced multiple fee tiers (e.g., 0.05%, 0.30%, 1.00%), allowing LPs to choose a risk level that matches their strategy. #UNI #Binance $UNI