By Justin Baba, Research Manager at Messari
Since its founding in 2018, Uniswap has become one of the main pillars of DeFi in the Ethereum ecosystem and a top DEX. During that time, it has processed $2.4 trillion in trading volume and generated $3.8 billion in fees for the protocol.
On October 9, Uniswap Labs launched Unichain, an L2 built on Optimism’s Superchain designed to help scale DeFi.
It is primarily designed to address the key challenges of DeFi: high costs, slow transaction speeds, and fragmented liquidity.
Reduced costs: Unichain will reduce transaction fees by 95% compared to Ethereum Layer 1, and costs are expected to decrease further as Ethereum’s rollup-centric roadmap develops.
Improved Speed: Unichain’s one-second block time and 250 millisecond subblocks will provide near-instant transaction speeds, as well as transparency and efficiency through a Trusted Execution Environment (TEE).
Native interoperability: Since Unichain is part of the Optimism hyperchain, its cross-chain messaging capabilities facilitate transactions between Unichain and any other hyperchain L2. In the future, chains outside the hyperchain ecosystem will achieve interoperability through ERC-7683, which creates a standard API for cross-chain transaction execution systems.
Unichain will also launch the Unichain Validation Network (UVN), which will allow UNI stakers to earn a portion of the ordering fees generated by the chain.
UVN is a decentralized network of node operators that can independently verify the latest state of the network.
This helps reduce the risk of a collator proposing both invalid blocks and conflicting blocks at the same time, a risk associated with a single-collator network.
To become a validator, users must stake UNI on Ethereum. The validators with the highest stake weight will be considered the active validator set.
By combining its DEX product with the interoperability provided by traditional general-purpose chains, Unichain will open the door to the development of new applications, especially in the DeFi space.
The value generated by Unichain will directly benefit UNI token holders as they will now be able to receive a portion of the revenue generated by the protocol, which has been a major discussion point within the DeFi community.
Currently, Unichain is live on the testnet, and the mainnet is expected to be deployed later this year.
