What is the Use of UNI Token (Introduction to UNI Token)
What is the use of UNI token? Uniswap is a decentralized exchange platform that
What is the use of UNI token? Uniswap is a decentralized exchange platform that provides a liquidity market. Users can exchange various ERC20 tokens (including Ethereum, Binance Smart Chain, and Solana) as well as tokens from other Ethereum-based projects (such as UNI) on this platform. It allows the protocol to add new assets or create new tokens in the Uniswap pool without affecting the price.
UNI token has two main purposes: one is providing liquidity to the Uniswap pool, and the other is rewarding users participating in protocol governance. The third use is staking on the Ethereum blockchain (e.g., SushiSwap). The last two purposes contribute to the Uniswap protocol and offer rewards.
Introduction to UNI Token
Editor’s note: This article is from BlockBeats (ID: BlockBeats) and reproduced with authorization from Odaily Planet Daily.
Uniswap’s founder, Hayden Adams, revealed in January 2020 that he was developing a decentralized exchange protocol based on Ethereum.
However, with the significant drop in UNI token price and increasing market volatility, many community members question whether UNI token can replace cryptocurrencies like Bitcoin. Currently, many people believe that Uniswap has lost its appeal and attempt to achieve its goal of reducing transaction fees by more than 50% through token incentives.
So, what is UNI?
Uniswap is a new decentralized digital currency exchange protocol. It provides users with a frictionless and fair market competition environment by adopting a “hybrid consensus” (a new algorithm), eliminating intermediaries’ interference. (Note: The confusion network effect is a major reason for how it affects the design of Uniswap.)
From the above text, we can see that initially, UNI was an unmanaged ERC-20 protocol maintained by a smart contract system. It allows anyone to create liquidity pools for their assets and then add them to the protocol for exchange, including various types of assets.
However, due to a lack of sufficient technical strength, it has not been widely used in the DeFi field. Instead, it is a place to establish partnerships with other DeFi projects. Therefore, UNI token is not designed to be a substitute for decentralization.
In addition, Uniswap introduced a method called “delegated proof of stake,” which implements “equity allocation” for certain participants in the network. This method aims to encourage UNI token holders, who participate in the platform’s governance, to vote and approve or reject any actions. This may help promote the healthy development of the ecosystem, especially for individuals and companies who do not intend to use decentralized financial services, as it may be a key factor for them to easily obtain rewards. The Uniswap team also plans to release a new version called “uncle-token” for managing liquidity pools on Uniswap.
Uniswap is an open-source platform that allows users to build custom protocols to create interoperable applications and earn rewards through it. The platform supports various use cases, such as payment processors and automated market makers. The most common one is UniSwap, which is the first functional DEX integrated with UniSwap smart contracts.
According to the official description of Uniswap, “If you choose to issue or redeem your UNI, make sure you agree to transfer your UNI to the specified wallet address.” The main working principle of Uniswap’s governance model is as follows:
1. Create a protocol that is completely independent of Uniswap.
2. Convert all reserves into UNI tokens and immediately put them into circulation until they are staked.
This article and pictures are from the Internet and do not represent qiAiAi's position. If you infringe, please contact us to delete:https://www.qiaiai.com/ai/23606.html
It is strongly recommended that you study, review, analyze and verify the content independently, use the relevant data and content carefully, and bear all risks arising therefrom.
Related recommendations
-
Bank of America may acquire Signature Bank according to billionaire investor Bill Ackman
On March 18th, billionaire investor Bill Ackman posted a message on social media saying that Bank of America had planned to step in and acquire the troubled Signature Bank. It is expected to release relevant information next Monday. Data shows that the current market value of Bank of America is estimated to be approximately $222 billion. So far, neither Bank of America nor Signature Bank has responded to this matter. （cryptoslate） Bank of America may acquire Signature Bank Analysis based on this information:Billionaire investor Bill Ackman recently posted a message on social media about Bank of America’s plan to acquire troubled Signature Bank, which has not been confirmed by either bank. The current market value of Bank of America is estimated to be around $222 billion. Ackman’s message on social media has caused a buzz in the financial world. Many investors and analysts are keeping an eye on Bank of America’s next move as acquiring Signature Bank could have a…
-
The Importance of Understanding the Relationship between MakerDAO, Maker Protocol, and Front-end Providers
On February 25, it was reported that because Jump Crypto and Oasis jointly recovered 120000 ETH Wormhole stolen funds through reverse attack, MakerDAO issued a…
-
What currency is switcheo swh (nss currency)
switcheo swh is what currency According to official information, the decentralized trading protocol Switcheo swh is a 12 month experimental project. According to the development team, its design objective is to achieve a fair, transparent, and borderless financial system. Currently, over 4 million users have used the platform Specifically, users can use SWH to pay transaction fees to obtain the governance token SWHT (Switcheo StandardToken). SWHT is an ERC-20token based on Ethereum; A Cryptocurrency that can be programmed as a smart contract; It can also be used to pay for any asset that provides liquidity on Uniswap nss coinAccording to the latest news from nss coin, the “Super Mining Pool” activity has been launched, and a vote has been initiated in the official community to decide whether to pass. NSS (also known as Mars Cloud) is a decentralized financial service application platform built for users based on blockchain technology; It is also a decentralized application store project According to the…
-
Ethereum Layer2: Lockup Volume Shows Strong Growth
According to reports, L2BEAT data shows that up to now, the total lockup volume on Ethereum Layer2 is $8.99 billion, up 2.91% in the past 7 days. Among them, the largest lockup vol
-
Arbitrum, Camelot, Coinbase, ARB: The Future of Decentralized Finance?
7:00-12:00 Keywords: Arbitrum, Camelot, Coinbase, ARB
Summary of important developments at noon on March 23rd
IntroductionDecentralized finance, or DeFi, has revolutionized the fin -
Cryptocurrency Industry May Move Away from USD-Based Stablecoins
According to reports, CZ said in the official Twitter Space of Binance that after the US regulatory crackdown, the cryptocurrency industry may move away from t…
-
Adopting Open Multiple ZK-EVM: Challenges and Solutions
According to reports, in his latest blog article, V Shen suggested adopting open multiple ZK-EVM to create a \”multi client\” ecosystem, but at the same time, he pointed out that thi
-
Blocknox Receives Final Approval as Cryptocurrency Custodian from BaFin
It is reported that Blocknox, the digital unit of the Stuttgart Exchange, has obtained the final approval of BaFin, the German financial regulator, as the custodian of cryptocurren
-
What does pps rate mean (how is pps calculated)?
What does pps rate mean? Today, Vitalik Buterin, the founder of Ethereum, expres
-
Understanding Panic and Greed Index in Trading
According to reports, today\’s panic and greed index is 58 (yesterday\’s 69), with a significant decrease in the level of greed compared to yesterday, and the level remains greed.
To