Uniswap V4: The new features that will revolutionize trade on decentralized stock exchanges

Uniswap V4: The new features that will revolutionize trade on decentralized stock exchanges
Uniswap V4: New features and improvements for decentralized crypto exchanges
When it comes to decentralized crypto exchanges, uniswap is the clear leader. The protocol has established itself as a leading platform within just 5 years and accounts for about three quarters of the total volume of all decentralized stock exchanges. In comparison, the Dex aggregator 1inch only has a market share of 6%.
This success is by no means undeserved. The team behind Uniswap is known for promoting the industry with innovative approaches. With the introduction of Uniswap V2, the protocol has taken a significant step forward. And now Uniswap V4 is in the starting blocks and promises many exciting new features that will revolutionize the token trade again in a decentralized manner.
One of the major changes in Uniswap V4 is the use of native ether (Eth). This makes the need for wrapped ether (Weth) superfluous, since other ERC-20 tokens can be paired directly with ETH. This means less effort and costs for users.
A further improvement affects the cost structure at uniswap. With flash accounting, users can carry out several operations within a pool without calculating each individual operation separately. Instead, only the net amount is billed. For liquidity providers, this also means savings, since the creation of a pool by singleton contracts becomes 99% cheaper.
The combination of singleton contracts and flash accounting will significantly improve the user experience at Uniswap. Complex swaps with minimal gas consumption will be possible, which compensates for uniswap of the user experience on centralized crypto exchanges.
One of the most exciting innovations in Uniswap V4 is the so -called hook. Every uniswap liquidity pool goes through a life cycle in which various actions take place. With Hooks, developers have the opportunity to incorporate custom code for certain events in the life cycle. This makes it possible to create individual AMM pools that enable various interaction between swaps, fees and LP positions.
The use of hooks opens up many options and innovations. For example, weighted market makers (tweet), dynamic fees based on volatility or other factors, limit orders on the blockchain, adapted onchain oracle, auto-compounding of LP fees and payment of internalized MEV profits can be realized.
As far as the fees are concerned, Uniswap V4 is based on the V3 model. There are separate fee mechanisms for exchange fees and withdrawal fees. Governance can withheld part of the exchange fees for a pool and optionally also charge a withdrawal fee. Unlike in V3, however, governance no longer controls the fee levels or ticking.
Finally, it should be mentioned that Uniswap V4, like its predecessor V3, is licensed under the Business Source License (BSL). This means that the source code of the V4 protocol is commercially and productively restricted for up to four years. Other developers are not allowed to fork the code without express permission or after the deadline.Uniswap V4 promises many exciting new features and improvements for decentralized crypto exchanges. With the use of native ether, more efficient cost structures and the introduction of hooks, the trade on uniswap becomes even easier, cheaper and more innovative. It remains to be seen how the community will react to these innovations and how they will influence the crypto market.
Source: Uniswap Blog