What is the Difference Between Uniswap V1 & Uniswap V2?

Uniswap has become one of the most profitable and successful projects which is part of the Decentralized Finance DeFi development.

It is a decentralized protocol for automated liquidity provision on Ethereum. In easy terms, It stores massive amounts of Ethereum network-based tokens, which allows the protocol to provide favorable services that weren’t already available in the market. It allows traders to swap Ethereum tokens without the requirement of an exchange or order book. 

Difference Between Uniswap V1 & Uniswap V2?

Uniswap V1

Uniswap V1 was the proof-of-concept for a new form of decentralized marketplace. It established the foundation of on-chain token swaps and decentralized liquidity pools that provided users rewards for adding liquidity and charged low fees to make token swaps.

Instead of an order book, token exchange rates are determined using what is termed the “constant product formula”, which will shortly be revisited further down. It actually provides a mechanism to carry a token’s value balanced relative to the token pair in question.

The basic token pairs (like DAI to ETH, or DAI to USDC etc) have individual liquidity pools combined with them, where users can add to the liquidity by providing either one of the tokens in the specified pool. Liquidity providers have then rewarded a share of a 0.3% fee whenever a transaction is made.

Features of Uniswap V1

l Add on any support of ERC20 token using the Uniswap factory

l Unify  liquidity pools to collect fees on ETH-ERC20 token pairs

l Trade ETH for any ERC20 without wrapping

l Trade any ERC20 for any ERC20 in every single transaction

l Trade and transfer to multiple addresses in a single transaction

l Liquidity-sensitive automated pricing utilizing constant product formula

l Lowest gas cost of any decentralized exchange

l Support for private and custom uniswap exchanges

l Buy ERC20 tokens from any wallet using ENS

l Partially verified smart contracts written in Vyper

l Mobile-optimized open-source frontend utilization

l Funded via an Ethereum Foundation grant

Uniswap V2

Uniswap V2 delivers a wide range of upgrades and improvements to the protocol that creates upon the swapping and liquidity mechanisms the first iteration released. 

The primary developments include:

Uniswap V2 provides users with 3 types of options to swap their tokens pairs, utilizing the “Router Contract.”

Where To Create a Decentralized Protocol like Uniswap?

Being well-versed DeFi Development Company, Developcoins helps to build your decentralized exchange protocol like Uniswap with advanced and innovative technologies!

We start to build your decentralized protocol with complete features which covers

 l Account

l Uniswap Function

l Liquidity Pools

l Token Addition

l User Provision

l User Features

l Admin Features

l Admin Revenue model

Build Your Decentralized Exchange Protocol like Uniswap here!