DeFi • February 16, 2024, 5:13 am EST
Published 1 minute earlier At
UPDATED: February 16, 2024, 1:22 PM EST
The Uniswap Foundation said that the upcoming launch of Uniswap's version 4 protocol is expected to take place in the third quarter of this year. “Uniswap v4 is expected to launch in the third quarter of 2024,” the foundation said said.
This time frame depends on the implementation of Ethereum's upcoming Dencun hard fork, which is scheduled to take place in March. The upgrade to version 4 (v4) is followed by a comprehensive security review of the protocol from Dencun.
Uniswap is the most widely used automated market maker – a decentralized exchange that facilitates trading between tokens using liquidity pools, rather than relying on traditional order books where buyers and sellers match orders directly.
Uniswap was launched in 2018 and has gone through several iterations, with Uniswap V3 being the current version and launched in May 2021. The key feature of v3 is that it supports “concentrated liquidity” – allowing liquidity providers to select specific price ranges in which their capital operates to earn higher fees.
What's new in Uniswap v4?
The v4 draft code suggests a shift towards a more modular structure for Uniswap, primarily through the integration of “hooks”. These hooks are smart contracts that provide additional customization to Uniswap's liquidity pools using methods such as dynamic fees, on-chain limit orders, and custom on-chain oracles.
Version 4 also introduces a “flash accounting” system that will result in lower fees for liquidity providers. The mechanism is based on “transient storage” enabled by the proposed EIP-1153 change in the Ethereum protocol and is planned to be integrated into the upcoming Dencun upgrade.
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