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Polkadot has announced that Uniswap, the most important decentralized exchange (DEX) in terms of daily trading volume, is entering its ecosystem through the Moonbeam Network parachain. This development is expected to significantly increase volume and liquidity in the Polkadot ecosystem by providing users with a trustless, permissionless, and custodyless way to trade and access tokens.
Polkadot and Uniswap partnership heralds a new era for DEX
The arrival of Uniswap on Polkadot is a significant event for the decentralized finance (DeFi) space as it adds visibility and momentum to the development of a new world of decentralized financial products and services on the Polkadot network.
1/ @uniswap – the popular most decentralized exchange by daily traded volume – is coming to Polkadot via the @MoonbeamNetwork parachain, increasing volume & liquidity across the ecosystem! pic.twitter.com/lKaceLv6ce
— Polkadot (@Polkadot) May 17, 2023
With Uniswap’s proven track record in the Ethereum ecosystem, the following opportunities will open up in the DeFi sector:
- Increased liquidity: The arrival of Uniswap on Polkadot is expected to increase the liquidity of the entire ecosystem as more users will be able to trade a wider range of assets on the platform. This will likely attract more liquidity providers and traders to the ecosystem, further boosting liquidity.
- Compatibility: Polkadot’s unique architecture allows the creation of custom blockchains or parachains that can be tailored to meet the specific needs of different applications. With the arrival of Uniswap on the Polkadot network, developers will have access to a proven DeFi infrastructure that can be used to create new and innovative products. This is expected to spur innovation in the DeFi space as well as facilitate seamless asset transfers between Ethereum and Polkadot.
- Untrusted, permissionless, non-custodial access to tokens: Uniswap provides users with a trustless, permissionless, non-custodial way to access tokens. Its appearance on Polkadot is expected to provide users with a more secure and decentralized way to access tokens, which is likely to attract more users to the ecosystem.
- Improved Scalability and Security: The high performance, scalability and security of Polkadot will benefit Uniswap users, who will be able to trade on a more secure and scalable platform.
Additionally, according to Osama El Sayed, Global Head of Growth and Development at ParityTech:
Polkadot is a great fit for Uniswap, whose users can enjoy high performance, scalability, security, and network compatibility. Polkadot’s DeFi ecosystem benefits from a prominent name in the field.
What is the Moonbeam network?
The Moonbeam Network is a Polkadot parachain that provides full Ethereum Virtual Machine (EVM) interoperability and native interoperability, and prioritizes secure cross-chain integration solutions. The past year has seen impressive user growth, and the Polkadot and Moonbeam Uniswap implementation initiative, led by the University of Michigan Blockchain Group, successfully passed Moonbeam’s governance processes today thanks to strong community support.
The addition of Uniswap to the Polkadot ecosystem via the Moonbeam Network parachain is a major development for the DeFi space. By increasing volume and liquidity on the Polkadot network and providing access to tokens without the need for trust, permissions and without storage, Uniswap will drive innovation and open up new opportunities for liquidity providers and traders.
Uptrend of the UNI token on the 1-day chart. Source: UNIUSDT on TradingView.com.
Featured image from Unsplash, chart from TradingView.com