Uniswap made a strong impact on the world of decentralized fiance (DeFi). Created in 2018 by previous employee of Siemens, Hayden Adams, Uniswap has become a key part of the DeFi market. Investment in Uniswap has been strong from the start. This is due to the company's central position in the Defi market, prior to the release of their coin in 2020. This makes Uniswap one of the newer coins to successfully hit the market.
To kick start investment in the native coin of the Uniswap system, UNI, those already using the system were given 400 UNI coins each. This got trading going in a big way and Uniswap initially reached a market cap of just over $9B in a very short space of time. This has attracted a lot of attention from investors considering which new crypto coin to add to their portfolio in 2021.
Uniswap has some core similarities to some of the other big DeFi players. It is fundamentally a decentralized financial system used to buy and sell cryptocurrencies. It works off of the Ethereum blockchain which is a popular choice for many decentralized protocols. Also, like many successful coins, it runs on open-source software to avoid the need for any forms of centralisation.
The Uniswap company, that created this protocol using smart contract functionality, is now considered to be the largest decentralized exchange on the market. This puts it in a very strong position to receive further investment and market adoption going forward. This is an attractive factor for those considering investing in Uniswap.
Uniswap has focused on providing liquidity in a consistent way, to facilitate quick and efficient transactions and this model has paid off. Uniswap has received large scale industry investment in its short time on the market and is in a very promising position.
This is why so many people are choosing to invest in Uniswap in 2021, to capitalize on the company’s continued success.
The Uniswap Protocol
Uniswap’s tailor-made protocol creates automated liquidity and allows trading along the Ethereum blockchain. It is fully decentralized which eliminates all of the intermediary fees associated with conventional banking. This allows for much quicker and more efficient trading than many traditional exchanges are able to offer users.
This open-source protocol has gained huge popularity across the DeFi sector. Uniswap provides a secure, uncensored form of currency exchange by utilising smart contracts on the Ethereum blockchain. It generates liquidity pools to keep its peer-to-peer transactions moving forward on the system without any third party interference.
Launch of Uniswap V3
Until recently the versions of Uniswap available were V1 and V2. The V2 protocol has improved on the V1 and was the version that was largely being used in the market once users upgraded their protocols. However, in May 2021 Uniswap completed their mainet launch of V3. Users will now need to move their liquidity from V2 to V3, just as they did before when upgrading from the V1 version.
There two main improvements for investors to know about, these are increased liquidity available and the tiered fee system. Each transaction incurs a fee to keep the system liquid and these fees are now graded. This is to ensure that the liquidity providers are being compensated based on the risk involved in the transaction. This should improve the liquidity available overall on this system.
Another useful asset for investors is the cheaper and easier use of oracles on this system. The main draw of this is that investors can easily check on the historical prices of the coin to decide whether to buy or sell. This is a huge bonus for those investing in 2021 as there will be much more information available to help with quick trading decisions.
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Trading UNI to USD
Uniswap had a strong start in life but still experienced sideways trading in its early stages. This continues throughout its initial months in 2020, but this was far less stagnancy than is often seen in the early stages of most cryptocurrencies.
The covid-19 outbreak of 2020 led to an unexpected surge of trust in the crypto sector. The result of this was a massive surge across the crypto market, with some coins experiencing surges by mid-2020. UNI was slightly later to have its surge, which began to gather pace in January 2021. UNI achieved an all-time high of $45 during this period.
However, the bear market which took hold of most of the cryptocurrency sector in May 2021 has brought down the UNI trading price substantially.
After the initial correction at the end of May 2021, there was a promising amount of recovery. The UNI price returned to nearly $30, back up from a low of $22. However, by June the bearish trading had taken over and a downward trajectory was in place. This can be seen across most of the Defi sector currently. There has been another substantial dip towards the end of June and the price has begun to fluctuate around the $15 mark.
The movements have been less volatile than seen in other leading crypto coins, however, the overall trend matches that seen sector-wide. With the bearish trading pattern still in place, it is likely that the trajectory will continue to point downwards as we head into July 2021.
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Will Uniswap Rebound from the Last Correction?
Uniswap did make some positive moments after the correction took place. After the peak corrected back down From $45 to $22, there was an upturn for several days in the last week of May which looked promising. However, this momentum could not contend with the bear market which has swept the Defi sector in May and June 2021.
This has brought the UNI coin price lower than the original correction dip. Recovering from this further decrease in price will take much longer and is less likely to be regained quickly without a major surge. No major surges are likely over the course of July so recovery could take several months.
Predictions for Uniswap in 2021 and the Future
The outlook for Uniswap is uncertain as the bearish trading continues across the cryptocurrency market. Uniswap has a good position within the Defi sector, as the leading decentralized exchange. This gives a good indication that once the market as a whole begins to recover, it will be one of the coins ready to recover its losses quickly.
For those willing to wait, investing in Uniswap while it is at this low point could yield profitable returns as we come to the end of 2021. However, the price is likely to drop slightly from its current price of $16. The next month is unlikely to lead to positive movement, although the coin should drop less substantially than it has over June.
However, experts are predicting that Uniswap will make up for this decline in 2022. The company itself is very keen on expanding, even while the market is struggling. Uni Labs has been reaching out to expand its network now that the V3 upgrade is live.
‘We’re thrilled to have
join Uniswap Labs as Chief Operating Officer!
MC will focus on growth, strategy and operations, contributing to the Uniswap community and building the team at Uniswap Labs (we’re hiring!)’
- @Uniswap, Twitter account of Uniswap Labs
UNI swap is continuing to focus on system improvement during this time which is a promising move for future price recovery. UNI has also been pushing their market adoption and maintaining their user community support. Their latest vote saw millions of users weighing in on decision making and was reported on by their CEO Hayden Adams.
‘With 4 days to go, the "DeFi Education Fund" proposal is sitting at:
Majority yes, but still 14m YES votes short of passing. I encourage all delegates to vote their preference:
- @haydenzadams, Twitter account of Hayden Adams, CEO of UNI Labs.
This level of community involvement signals a strong network of users who will continue to push UNI forward. This should bring the coin price back up at a quicker rate when the bear market subsides and bullish trading can take over.
The UNI coin is estimated to be on track to hit $70 by the middle of 2022. If it continues on this trajectory it could reach $130 by the end of 2022, although there is likely to be some correction after this point, which would bring the coin closer to $100.
Uniswap Trading Forecast for 2021
Despite the negative turn taken in May 2021, UNI has performed surprisingly well. UNI is up by 290% this year to date, even with the bear market in place. This is a very strong position to have maintained in the current market.
The Uniswap prices are going to be subject to fluctuation throughout the rest of 2021, which gives the option of swing trading to achieve short term profits. For larger returns, there is unlikely to be many options before the end of 2021 and investors are likely to have to wait until 2022. For those who buy while the coin price is low, the projected surges in 2022 could be extremely profitable.
However, market experts are predicting that UNI will return to at least $38 before the end of 2021, which would bring some good news to those buying at the lower price point. The more optimistic viewpoint puts $50 as an achievable mark for the end of 2021, however, this is less supported than predictions of $38.
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Who is behind Uniswap?
Uniswap was created by Uni Labs, the company behind the protocol. The main developer was Hayden Adams, CEO of Uni Labs. Adams previously worked at Siemens as a mechanical engineer.
Uni Labs created the Uniswap exchange in 2018 and launched the native token UNI in 2020.
What is Uniswap?
Uniswap is a protocol that uses open-source software to create an automated decentralized currency exchange. It automatically maintains liquidity which allows the system’s users to make transactions using smart contract technology.
The system is designed to be fast, efficient and secure as a money transfer system. It works along the Ethereum blockchain using ERC-20 tokens to make the necessary transactions on the Ethereum blockchain. It is currently considered to be the largest decentralized currency exchange.
How does Uniswap compare to Bitcoin?
Uniswap is a decentralised blockchain system for transferring money. It does not have its own blockchain, as Bitcoin does, and instead, it uses the Ethereum blockchain to make transactions.
Bitcoin is a cryptocurrency that can be mined, this is not the case for Uniswap. Instead, UNI coins are added to transactions and used to incentivize liquidity providers. They are more similar to the so-called, pre-mined systems of cryptocurrency.
Bitcoin is the leading cryptocurrency but Uniswap ranks at a respectable 11th, by market capitalization, at the time of writing. Uniswap has a market cap of $16.1B current.
Uniswap is most focused on efficient transactions, whereas Bitcoin is designed primarily as a store of value, replacing similar assets such as gold. Uniswap is also much newer to the crypto marketplace than Bitcoin and is at an earlier stage in its development.
Should I invest in Uniswap in 2021?
The current bear market has brought down the Uniswap UNI price substantially, making it a good time to enter the market at a low price point. By adding UNI to your portfolio during this downward trading pattern, you stand to make greater percentage returns when the market recovers later in 2021 and into 2022.
Is Uniswap still going to go up?
Uniswap is very likely to go up from its current price of $16.10, at the time of writing. This price may drop further before bullish trading resumes, however, the following positive trading should take the price above its current price of $16.10 easily.
The price should continue to rise after this point, into 2022, with intermittent surges leading to some major increases.
What will UNI prices rise to in 2021?
The predictions for Uniswap in 2021 are mixed, as some experts are stating that UNI will rise to an all-time high of $50 by the end of 2021. However, it is more likely that UNI will continue to hover around the $20 mark for the remainder of 2021.
If the bearish trading pattern continues then UNI may not exceed $20. However, if the bear market ends before the final months of 2021, then the bull market could take the coin closer to the previous high of $45.