Written by Erik Weijers 12 days ago

Upcoming: trading NFTs on Uniswap

Starting this fall, users of Uniswap will also be able to trade NFTs. Until now, on Uniswap it was only possible to trade ERC-20 tokens, the "normal" fungible tokens on Ethereum. The move into NFT land shows that Uniswap is and will continue to be an innovative player, and possibly will only become more dominant in its niche.

What is that niche? Uniswap is a decentralized exchange (DEX). That is, it allows users to trade directly, wallet to wallet, with other crypto owners. There is no middleman, no help desk: it is pure software.

Now Uniswap has bought Genie: an NFT marketplace aggregator. Genie is a platform where you can at once access multiple NFT marketplaces: Opensea, LooksRare, Foundation, and X2Y2. Genie is around since November 2021 and is taking market share from competitor Gem.

With the acquisition, Uniswap clearly signals its intention to offer all digital goods that people can own. Current users of Genie will benefit from the acquisition: they will receive an airdrop in USDC. The 'snapshot' that determines which Genie users qualify has already been made.

About Uniswap

Since 2020, the use of Uniswap has exploded. Despite all the copycats, like Sushiswap and Pancakeswap, it is still by far the largest DEX. Its trading volume on the order of $1 billion per day is comparable to a centralized exchange like Coinbase.

Uniswap has its own coin: UNI. Its price has been in a free fall in recent months. This, of course, has to do with the overall malaise in crypto. The fact that Uniswap has a consistently high market share and is clearly innovating are good signs.

Can UNI price rise due to fee switch?
One of the ways in which the price of UNI could benefit from high trading volumes is the so-called fee switch. Currently, a trading commission (fee) of 0.3% per trade goes to the liquidity providers: these are users who put their capital in liquidity pools. In the Uniswap protocol there is a possibility encoded to pay 0.05% of the transaction fee to the protocol itself, which would benefit the holders of UNI. It is not yet known if and when this fee switch will be turned on. For Uniswap, it is now a USP that it pays out the most to liquidity providers of all DEXes. On the other hand, the holders of UNI would also like to see a return on their investment.

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