Uniswap Labs – the developers behind Uniswap, DeFi’s largest exchange – has released a series of important features to improve prices and optimize the cost of gas for swaps.
What Does the Update Have in Store?
Uniswap Labs have now released an updated Auto Router that enhances trade prices to a greater extent by routing trades across both Uniswap v2 and v3 pools. With this, users will be able to track the true cost of a swap in real-time directly from the App interface. In addition to optimizing the gas costs, the new release also finds the best price across all Uniswap protocols.
Another major development that accompanied the update was Auto Router supporting both Optimistic Ethereum and Arbitrum. The changes aim to provide a cost-effective overall business experience using efficient business pricing coupled with the low gas costs of a Layer 2 network.
Besides, the Uniswap App will now feature a USD estimate of the gas fee before submitting a swap. With the help of gas estimates, the app will also automatically set slippage based on traders’ expected gas cost as well as trade size.
The initial version
Since the launch of Auto Router three months ago, Uniswap Labs has revealed that it is a “major victory” for v3 users. According to the platform’s analysis, Auto Router improves prices for 13.97% of all trades and 36.84% of trades between the top ten tokens in terms of Total Locked Value (TVL).
Earlier in September, Uniswap Labs deployed three essential elements – split routes, a more powerful algorithm, and gas cost awareness.
Split routes allowed users to execute transactions on multiple pools simultaneously by splitting them. This is very different from the traditional router, where only one route is used for the execution of transactions. With the Auto Router, traders were able to spread trades over up to seven paths, allowing them to benefit from deep liquidity in different pools.
It also explored liquidity at greater depth, thereby allowing efficient execution, especially on a large trade. Additionally, the release also enabled gas costs to optimize users’ effective prices, which reduced the number of gas-intensive hops to reach the output token and facilitate the more efficient execution of smaller trades.
The trajectory of Uniswap
Despite the emergence of several platforms in the decentralized economy, Uniswap continues to benefit from its leadership position in the DEX market. According to the latest chart compiled by Dune Analytics, Uniswap’s share of the DEX market is 78%, followed by rival SushiSwap with a share of 8%.
