Evan SelemaniDespite the fact that cryptocurrencies promote decentralization, the vast majority of them are traded on centralized platforms. This goes against the idea of bypassing middlemen such as banks. Fortunately, the decentralized exchange platforms have emerged and are now attracting a growing number of users. This is the case of the Uniswap platform.
The euphoria surrounding the Uniswap platform was accompanied by an increase in the price of its cryptocurrency, Uni. However, as of this writing, the market as a whole is down.
Is this the opportunity to get the Uni coin at a great price? Cryptocurrency Is Uni one of the projects with high potential? Keep reading to learn how the Uniswap protocol works, the benefits and risks of such an investment, and the future prospects of the project.
🦄 Uniswap crypto (UNI): What is it? the context?
Uniswap is a decentralized exchange platform (DEX) which allows users to easily exchange Erc-20 coins (developed on the Ethereum blockchain) without going through an intermediary. It facilitates the exchange of Erc-20 tokens via liquidity pools.
What is a liquidity pool? A liquidity pool can be defined as a pool of tokens freely deposited on a decentralized exchange platform, such as Uniswap, to facilitate trading with other cryptocurrencies.
Users who deposit their cryptocurrencies into the Uniswap protocol are called liquidity providers ou Liquidity Providers (LP). They receive trading fees in exchange for their contributions.
(🤓 You can read our article to learn more about the role of liquidity providers)
The idea of the Uniswap platform dates back to 2016When Vitalik Buterin offers a trading platform that would use an automated market maker with some unique features. Hayden Adams develop this concept in 2017.
How does Uniswap work?
The Uniswap protocol uses an automated market-making system in place of an order book. This is what we know under the acronym of AMM (Automated Market Marker). It is based on an algorithm known as “Constant Product Market Maker”, which helps determine the exchange rate and price slippage.
Truth be told, investors do not need to rely on a centralized platform to transact. A user only needs to have a wallet, such as Safepal or Metamask, and deposit some ether (ETH) to pay the fees and start trading immediately.
Uniswap is based on two main smart contracts:
- The contract “Exchange” whose role is to ensure token exchanges by holding a pool (a reserve of tokens) of Ethers (ETH), and another Erc-20 token.
- The contract "Factory" whose role is to create a new “Exchange” contract and register the Erc-20 token at the contract address.
In practice, when you deposit a token into the pool, you must also deposit the same amount of ETH. Number of ERC-20 tokens and Ethers can fluctuate depending on the different transactions that take place in the pool. For example, if you want to exchange the UNI token for ETH, your UNI deposit will increase but your ETH deposit will decrease.
(🤓 Read the article to learn about the ERC-20 token standard)
What are the future prospects for UNI crypto?
Launched at an initial price of less than one euro in September 2020, the crypto price United quickly climbed to more than six euros before ending the year at 4,2 euros. The price of Uniswap reaches new highs in 2021, rising from 4 euros to 44 euros in May. However, due to the general decline in the market (currently), it currently fluctuates between 5 and 10 euros.
Will it increase significantly in the coming years?
Let's look at the facts! Uniswap continues to improve its protocol by adding new features such as price oracles, flash swaps, and other technical improvements. Recently, Uniswap integrated the decentralized NFT exchange Sudoswap in order to enable its users to carry out efficient NFT trading.
In terms of market capitalization, Uniswap now ranks third in the decentralized finance sector, first in the yield farming sector, and seventh in Ethereum (ERC20) tokens.
Although the Uni crypto is down 80% from its ATH (All Time High). Uniswap protocol has become the leader Dex Challenge (decentralized exchange) in terms of total value locked (TVL). We believe that the Uniswap platform has the potential to attract more users and therefore positively influence the price of UNI crypto.
Where to buy UNI crypto safely
Uniswap is a decentralized platform allowing cryptocurrencies to be exchanged with each other without having to go through an intermediary. But to buy UNI crypto, the easiest way is to go through a centralized platform allowing to exchange fiat currency for Uniswap.
However, there are now a plethora of platforms that make it easy to purchase UNI crypto. Some are safer than others, which is why the investor must exercise caution when selecting a platform in order to avoid poor user experience, phishing attack or any other type of attack.
What is the status of the Binance platform in terms buying Uniswap (UNI) cryptocurrency? Below is our opinion on Binance.
Buy UNI crypto on Binance: A better solution?
Binance is an exchange platform dedicated exclusively to cryptocurrencies. It made its debut on the market in 2017 presenting a complete platform, including almost all services related to cryptocurrencies.
Today, the Binance platform has an unprecedented number of transactions and approximately 90 millions of users. Indeed, Binance provides a comprehensive platform that allows investors to take advantage of various features such as staking, buying, selling and trading cryptocurrencies, peer-to-peer trading, leverage, lending and a variety of other features.
How to buy Uniswap (UNI) crypto on Binance?
The good news with Binance is that the interface is intuitive. Simply follow these few steps:
- Visit the Binance website
- Complete your email address or phone number
- Enter your password and accept the terms of use
- Click on 'Register'
- Validate your email by clicking on the link sent in your email.
- Verify your profile by providing some additional information (country, ID card, proof of residence) in order to combat illegal activities
- Click on the tab “Buy cryptos”
- Choose a method of payment (e.g. credit card, bank transfer, etc.)
- Select Uniswap (UNI) from the assets.
(—> You can read thetutorial article on how to buy bitcoins on Binance.)
How to Stake UNI crypto
Uniswap is a decentralized platform based on the Ethereum blockchain. In fact, it is Ethereum that is responsible for protecting its network. But itow can you have a passive return with UNI crypto?
The concept of Uniswap is similar to that of staking. However, to receive new coins as rewards from Uniswap, you must provide liquidity. In crypto jargon, this method is known as Yield farming, which literally means “yield farming”.
(👨🌾 Read our full article on Yield farming)
Here's how it happens: the user who decides to leave their funds blocked in a liquidity pool on the uniswap protocol receives commissions in cryptocurrency and thus generates passive income.
However, if this all seems a little too technical for you, there are platforms that do the work for you. Simply deposit Uni tokens to receive a set percentage each year.
Due to the popularity of cryptocurrencies, these platforms compete for attention, and some of them do not provide quality services. We have screened a large number of platforms to present to you one of the most viable options.
Youholder: Earn 7% on your Uniswap tokens (Uni)
Youholder is a staking platform that allows its users to earn interest on deposited cryptos, as well as to obtain loans, buy and sell cryptocurrencies.
It is one of the most popular platforms on the market that offers to earn passive yield on Uniswap (Uni) tokens as well as a host of other assets. For Crypto Uni deposits, la Youholder platform pays up to 7% per year.
Should you buy Uniswap (UNI) crypto?
Uni is the governance token of Uniswap, which is an automated liquidity protocol. Before answering the question of whether it is necessary invest or not in crypto Uni, Let’s first look at the offering from the decentralized exchange, Uniswap.
For its users, the Uniswap protocol has four main functions:
- Exchange assets: the user can trade assets through decentralized markets created on the platform.
- Create new markets: New pairs are added easily using smart contracts. Which promotes the exchange of a large number of assets
- Providing liquidity:Users who stake (agree not to trade or sell) their cryptocurrencies on Uniswap are rewarded with new coins.
- Participate in governance: Uniswap token holders have the power to vote on improvements to the Uniswap protocol. The greater the quantity held, the greater the vote.
However, keep in mind that every investment involves risks. Before deciding to invest in Uni cryptocurrency, it is essential to take into account the different risks that we list below.
Benefits
- Uniswap allows you to have a passive return by creating liquidity
- Uniswap facilitates the exchange of a variety of assets including NFTs
- Uniswap is a protocol accessible to everyone
- Uniswap respects the privacy of its users
- Uniswap benefits from the security of the Ethereum blockchain.
Risks
- Uniswap only supports cryptocurrencies compatible with the Ethereum blockchain
- Users are dependent on the crypto Eth.
- Some wallets are not supported.
- A little too difficult to understand for novices.
Which wallets are compatible with Uniswap?
Uniswap is compatible with many digital wallets, including hardware wallets such as Safepal. Indeed, a wallet is essential for store, send and receive Uni crypto.
Today there are a plethora of wallets that we can categorize into two:
- Cold Wallet or Hardware Wallet
- Hot Wallet or Software Wallet
Cold Wallet or Hardware Wallet
This is a support that allows you to store your cryptocurrencies offline. It is recommended to use these types of wallets to stay safe from hackers. The support costs between 50 and 100 euros. Ledger, and safepal are two examples.
Hot Wallet or Software Wallet
This is an application that allows you to store cryptocurrencies on your computer or smartphone. To use it, simply download it for free and configure it. These types of wallets are only recommended for small amounts of money. Take the example of Metamask and Trust wallet.
Conclusion on buying UNI crypto (uniswap)
Uniswap is one of the market makers the most flexible and efficient which creates the peer-to-peer market. The Uniswap platform allows users to exchange cryptocurrencies without the intervention of a centralized third party.
In fact, Uniswap is revolutionizing the way people exchange money. Anyone can use it to trade assets, provide liquidity in exchange for passive income, and create a new market for trading various cryptocurrencies.
In the future, the popularity of this protocol which eliminates any centralized third party, and which resists regulation is more likely to be accompanied by the appreciation of the Uni cryptocurrency. Additionally, there is a very important element to consider: the ethereum merge.
This is the big shift from proof of work to proof of stake on Ethereum. This could generate excitement around the Uniwap platform if Ethereum becomes very popular again. This should be noted in any case…
Do you want to get some? Just use a reputable platform like Binance.
—> Read our article to find out how to make money on Uniswap.
FAQ: Buying Uniswap (UNI) crypto
What tokens are available on the Uniswap platform?
Uniswap is capable of supporting the exchange of any digital token that complies with the Ethereum standard known as ERC-20.
What was the lowest price of Uniswap (UNI) crypto?
The lowest price of the Uniswap (Uni) crypto was at 0,41 euros on September 17, 2020.
What was the highest price of Uniswap (UNI) crypto?
The highest price of the Uniswap (UNI) cryptocurrency was reached on May 3, 2021, at around 44 euros.
Note: No financial advice is given in this or any other article on zonebitcoin. This is information of which you are the sole judge and master. Be responsible with your investments and only invest as much as you are willing to lose.
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