The long-awaited official announcement about the release of Uniswap version 3 has finally arrived. That said, hopes for major improvements in transaction costs and speeds were frustrated.
Following an announcement published on March 23, the team behind Uniswap, the world’s most popular decentralized exchange, finally released details of version 3’s technical specifications.
The main network launch is scheduled for May 5th. Layer 2 scaling will then follow.
Uniswap is currently the biggest gas hunter in the crypto industry. The exchange has received $ 2 million in fees over the past 30 days, according to the ETH Gas Station. While the new version cannot fix the problem directly, we hope it alleviates these issues.
In the recently announced specifications, it was stated that there will be some improvement in gas prices. However, Gas costs will not be fully reduced until Tier 2 scaling becomes available at a later date. In short, don’t expect any delay from these painful transaction costs.
What it did was bring v3 something called “concentrated liquidity”. This provides “granular control” over price ranges for their allocated capital to individual liquidity providers. Positions are pooled together into a single pool and creates a compound curve that users can trade.
“LPs can provide liquidity with a capital efficiency of up to 4000 times compared to Uniswap v2 and provide higher return on their capital.”
It was also stated that there will be more than one flexible fee level for risk compensation while providing liquidity. In addition, the introduction of oracles developed in v2 developed the time-weighted average price (TWAP) system. However, it will not be the big gas savings many hoped for.