Polkadot’s Moonbeam Parachain Prepares for Uniswap V3 Launch: Embracing DeFi on a New Frontier

• Within a month’s time, decentralized exchange (DEX) Uniswap plans to deploy the Uniswap V3 iteration for Polkadot users.
• The Moonbeam parachain took the initiative to approach Polkadot, and allow them to run Uniswap V3 smart contracts.

On Wednesday, May 17, the world’s most popular decentralized exchange (DEX) Uniswap announced that it will soon be deploying on the Polkadiot blockchain network via the Moonbeam parachain. The Polkadot parachains are basically heterogeneous blockchains connected to the Polkadot mainnet.

These Parachains are interoperable among themselves as well as the Polkadot Network. The Parachains get their name as they run parallel to the Polkadot relay chain. The launch of Uniswap on Polkadot will boost liquidity as well as increase trading volumes across the ecosystem.

1/ @Uniswap – the most popular decentralized exchange by daily traded volume – is coming to Polkadot via the @MoonbeamNetwork parachain, increasing volume & liquidity across the ecosystem! pic.twitter.com/lKaceLv6ce

— Polkadot (@Polkadot) May 17, 2023

The decision to launch Uniswap on Polkadot comes following a unanimous governance vote undertaken through an initiative – Blockchain at Michigan. It is an educational organization that seeks to create blockchain industry leaders for the future.

Within a month’s time, decentralized exchange (DEX) Uniswap plans to deploy the Uniswap V3 iteration for Polkadot users. Over the previous versions, this would be better in terms of capital efficiency along with offering flexible fee structures as well as improved user experience.

The introduction of Uniswap V3 on Polkadot will happen via the Moonbeam parachain running atop the network. In an email to the Decrypt publication, a Uniswap spokesperson said:

For UNI being a bluechip and always being at the forefront of DeFi innovation, we always intended to have Uniswap deployed on Polkadot in some way, shape, or form.

Boosting DeFi Activity on Polkadot

The representative from Uniswap stated that the Moonbeam parachain took the initiative to approach Polkadot, and allow them to run Uniswap V3 smart contracts.

Polkadot approved the proposal primarily for two reasons: Currently, Moonbeam contributes to the highest DeFi activity on Polkadot and the parachain architecture is “the most EVM-friendly in our ecosystem”. this allows Ethereum virtual deployments “as smooth and frictionless as any other EVM chain out there.”

Furthermore, the parachains massively improve scalability by making sure that every transaction competes against all other smart contracts in the network. On the other hand, Uniswap offers users a permissionless, trustless, and non-custodial way to access tokens.

Uniswap’s arrival on the Polkadot blockchain will provide visibility and momentum toward the development of decentralized financial products and services on the Polkadot blockchain. Omar Elassar, Global Head of Growth & BD at @ParityTech, said:

“Polkadot is a strong fit for Uniswap, whose users can discover the network’s high performance, scalability, security, and interoperability. Polkadot’s DeFi ecosystem benefits from a marquee name in the space.”

The demand for decentralized exchanges (DEXs) like Uniswap has shot up recently after the failure of several CEXs over the last few months. As per the Q2 report by CCData, “Uniswap V3 has taken the lead in terms of trading volume, capturing 50.3% average monthly market share of the total decentralized exchange volume”.

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