Erik Weijers, 2 months ago
Uniswap Labs, the company behind Uniswap, has raised $165 million in a new funding round. Uniswap Labs can use the capital to expand the number of services it offers. It’s a remarkable injection of capital at a time when the bear market is in full swing.
The series B funding round is for Uniswap Labs yet another way to raise capital besides the so-called fee switch, which is in the works. Activating this fee switch would fund Uniswap from within, so to speak. It would make a small percentage of trading fees flow to Uniswap’s treasury. Currently, all the fees go to liquidity providers.
Uniswap is a decentralized exchange (dex), where users can swap tokens - or provide liquidity for others to swap their tokens. It has around 50% of the market share of all dexes. The new funding round values Uniswap at 1.6 billion dollars. If this sounds like a lot, consider that Uniswap has 25% of the users of Coinbase, which is valued at 15 billion dollars.
Uniswap’s coin UNI currently trades around 6 euros per coin, which comes down to a market cap of almost 5 billion dollars. This used to be around 20 billion at the peak of the bull market. It’s interesting that Uniswap’s market cap as measured in equity is lower than the value of all the UNI coins added. This shows that much of Uniswap's market value is held by ordinary users - after all, anyone can buy UNI, but to invest in shares you have to be a qualified investor.
Uniswap keeps innovating. One example is the introduction of concentrated liquidity, introduced by Uniswap v3. It allows liquidity providers (LP’s) to take positions in a certain price range for a trading pair. This increases the efficiency with which LP’s can deploy their capital. It allows them to implement refined strategies as opposed to just dumping their coins in a pool and hoping for the best.
Another example of innovation is Uniswap’s NFT market aggregation product. This is expected to launch in autumn 2022. Instead of hosting NFTs on its own platform, Uniswap plans for the platform to give users the ability to access NFTs from multiple marketplaces.
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