Uniswap, the largest decentralized exchange (DEX) protocol in the world of decentralized finance (DeFi) has been taking leaps and bounds in the last couple of months. It has been on a series of project upgrades and launching its Uniswap V3 on various different chains to bring more users into its fold.
Very recently, it was launched on the BNB Chain after a very contentious vote that took place on the Uniwsap DAO governance forum. It was passed with a majority of 65.89% standing in favor of the proposal, while 33.57% remained against it.
Read about it here: Uniswap Version 3 Goes Live on BNB Chain!
Now, in the latest news, Uniswap, which is the largest DEX player in the market by total-value-locked in DeFi, is all set to launch its V3 iteration on the Avalanche blockchain network. Avalanche is an Ethereum-compatible layer-1 blockchain with over $1.5 billion in TVL.
To complete this deployment on the Avalanche network, Uniswap has chosen LayerZero to be used as the bridge as it supports both Ethereum and Avalanche networks. LayerZero is a bridging protocol that is backed by investors like Uniswap Labs, a16z, and even Coinbase.
According to the proposal,
“The primary urgency behind this proposal is the upcoming BSL expiration on April 1st.”
This comes two years after the launch of Uniswap V3 - when its Business Source License (BSL) is set to expire by April 1, 2023. After April 1, developers will be free to copy the codebase since under the BSL the V3 codebase is closed-source and can only be used with Uniswap's permission.
According to a report by theDefiant.io, this move by Uniswap can be attributed to the intention to deploy V3 all across the DeFi ecosystem before any potential forks from its codebase establish themselves in the marketplace.
This proposal was passed with overwhelming support for the motion - with over 95% voting in favor of it and about 4.9% against it.
What is Uniswap V3?
Uniswap V3 or version 3 is an upgraded version of Uniswap that was launched back in March 2021 and it included a concentrated liquidity feature. This feature has been widely hailed as a breakthrough for automated market makers (AMMs) in the DeFi space as it offers far improved capital efficiency.
With a successful deployment of V3 on the Avalanche blockchain network, the Uniswap protocol will effectively be available across seven major chains in the industry, including Ethereum.
Wormhole vs LayerZero
Earlier last week, Uniswap after a contentious vote was finally deployed on the BNB Smart Chain, with Wormhole as the bridging solution for the deployment. This saw a very dramatic series of events during the governance vote on the Uniswap DAO, where a16z, a major holder of UNI tokens, voted heavily against the move.
a16z, the firm that voted against the proposition stated that Wormhole had a history of being a victim to hacks and compromises and thus, LayerZero was a better option to be picked up as the bridging solution in this situation. LayerZero also happens to be in the VC firm's portfolio of investments thus proving to be an additional incentive.
However, despite a16z's comments, at the end of the voting period, the proposal was passed with a nearly 66% vote in favor and a little over 33% voting against the proposal.
According to the report by theDefiant.io, in response to the infighting that happened last time around, Uniswap has created the Uniswap Bridge Assessment Committee which has been tasked with selecting bridges for future deployment of the protocol. The committee is currently in the process of assessing 8 bridges and three bridge-agnostic solutions.
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