{"id":148638,"date":"2020-08-21T17:00:16","date_gmt":"2020-08-21T16:00:16","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=148638"},"modified":"2020-11-12T21:56:36","modified_gmt":"2020-11-12T21:56:36","slug":"top-crypto-vc-explains-how-ethereums-uniswap-will-eventually-be-unbundled","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/top-crypto-vc-explains-how-ethereums-uniswap-will-eventually-be-unbundled\/","title":{"rendered":"Top crypto VC explains how Ethereum’s Uniswap will eventually be “unbundled”"},"content":{"rendered":"

The foremost Ethereum-based decentralized exchange, Uniswap<\/a>, has garnered much traction in recent weeks due to the growth in the decentralized finance (DeFi) space.<\/p>\n

As reported by CryptoSlate previously<\/a>, the decentralized exchange, better defined by the term “automated market maker,” has been processing over 100,000 transactions each day. \u00a0This amounts to around 1.2 transactions every second. For context, Bitcoin processes around 325,000 transactions a day at around 3.6 transactions per second.<\/p>\n

The exchange is also regularly processing trade volume nearing<\/a> that of mainstream companies like Coinbase.<\/p>\n

Despite this success that Uniswap has seen, one prominent venture capitalist says that Uniswap may eventually become “unbundled.”<\/p>\n

How Ethereum's Uniswap could become unbundled over time<\/h2>\n

Haseeb Qureshi, a managing partner at Dragonfly Capital that formerly worked at Airbnb and Earn.com, says that despite Uniswap's primacy in the decentralized finance space and Ethereum as a whole, it could soon be “unbundled.”<\/p>\n

“Uniswap today is the single largest \u201cexchange\u201d on DeFi. It routinely posts volumes larger than most centralized exchanges. Uniswap has revolutionized DeFi, brought billions of dollars in trading volume, and sparked a Renaissance in AMM (automated market maker) design. But I believe it\u2019s inevitable that Uniswap is going to be unbundled.”<\/p><\/blockquote>\n

That's not to say that Uniswap will collapse entirely, but that its components may be split up amongst applications.<\/p>\n

Qureshi explained that Uniswap has four key components or features. In his words:<\/p>\n

    \n
  1. Decentralized inventory provision<\/li>\n
  2. A fixed fee model (specifically, a flat 0.3% fee on each trade)<\/li>\n
  3. Always-on price quotes<\/li>\n
  4. A constant product pricing function (x * y = k<\/code>)<\/li>\n<\/ol>\n
    \n

    Uniswap is today the largest DEX in DeFi, and trades more volume than most centralized exchanges. But I believe that it's inevitable that Uniswap is going to be unbundled.<\/p>\n

    Here's what I believe the future of on-chain market making will look like:https:\/\/t.co\/FGvvfN0rRr<\/a><\/p>\n

    — Haseeb Qureshi (@hosseeb) August 20, 2020<\/a><\/p><\/blockquote>\n