Uniswap is trying to spice things up with the addition of two new smart contracts that may support more friendly rates. These developments may be an attempt to boost demand for the platform’s services.
Uniswap aims to make the DeFi experience much smoother and more convenient for users this year. This is a necessary step, especially on the road to boosting adoption. The latest update reveals interesting improvements aligned with the goal of a smoother platform.
Realistic or not, here is Uniswap’s market cap in terms of BTC
Uniswap recently revealed in its latest blog post that it just rolled out two new smart contracts. They include Permit2, which will facilitate sharing and managing token approvals across a range of applications in a more cost-effective and efficient manner. The other smart contract is Universal Router, designed to enable ERC20 and NFT swapping unification.
🦄 Uniswap Labs: Every time we upgrade our router, users have to spend gas to re-approve tokens. But no more!
With Permit2 you now have to approve again, but never again. Small expenses for big savings later!
— Uniswap Labs 🦄 (@Uniswap) January 18, 2023
In other words, the two smart contracts are strongly focused on introducing the most cost-efficiency to users. One possible implication of this rollout is that users save on gas costs. This move could encourage more people to join Uniswap or more transactions on the network.
Can Gas Cost Savings Support More Activity?
A look at Uniswap’s latest achievements can provide a better understanding of why this move is necessary. Uniswap trades and volume remain low despite the recent turmoil in the market.
Source: Glassnode
This is contrary to the expectation that a market pivot followed by strong demand would lead to more volumes and trades on Uniswap. This is why Uniswap may need to make some changes to try and make the DeFi platform more interesting for users.
An analysis of addresses on Uniswap shows steady growth in the total number of addresses using the platform over the past three months. However, the number of new addresses also remained low in the first week of January.
Source: Glassnode
The lack of an influx of new addresses can be due to several factors. However, this directly impacts Uniswap’s ability to support growth, and thus the need to do things differently. It can also affect the demand for the UNI native token.
An evaluation of UNI’s exchange flows shows that there was a remarkable increase in exchange activity in the first two weeks of January. Nevertheless, currency inflows have dominated the market, especially in recent days.
Source: Glassnode
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The above observation suggests that many UNI holders are making a profit. This can be translated as a sign that there is a low incentive to maintain UNI. It also matches UNI’s price action, which has retreated by as much as 13% from its current monthly high so far.
Source: TradingView
UNI was trading at $6.02 at the time of writing. A long-term downside could take it as low as $5.74 where it could experience the next price floor. This is because at that level it will interact with the 50-day MA, which can act as a psychological buying zone.
This post Uniswap wants to help you save on gas costs through this new upgrade
was published first on https://ambcrypto.com/uniswap-aims-to-help-you-save-on-gas-fees-through-this-new-upgrade/
