UniswapX: Get the Best Deal When you Swap Crypto

What is UniswapX?

We’ve already covered Uniswap Lab’s user-friendliness and front-end innovation.

But how about the decentralized exchange’s underlying tech, does it keep up?

UniswapX is Uniswap Lab’s latest protocol development that users don’t see, but makes their crypto-swapping experience significantly better.

By sourcing liquidity from the wider DeFi ecosystem, users are getting better crypto swap deals than ever – not to mention a bunch of other perks. 

Overall, Uniswap Protocol’s wider performance speaks for itself, with its presence rapidly growing across Layer 2 networks and pulling off some crazy stats.

Get ready to uncover the incredible potential of UniswapX and a multi-chain future, as we dive into its game-changing features.

What Makes UniswapX Special?

The biggest problem for crypto exchanges right now is fragmented liquidity. 

In other words, sources of tokens for trading are stuck in separate places across the ecosystem. It’s difficult to track down the best deal for crypto swaps.

This includes a number of different platforms, different pools, and different fee structures. 

The solution? UniswapX.

UniswapX is a decentralized exchange protocol that pulls liquidity from completely new sources for Uniswap users – rather than just from Uniswap Protocol pools themselves. 

Could’ve gotten a better deal from another decentralized exchange, liquidity pool, or capital reserves? 

You no longer need to worry. UniswapX will make sure you get the best deal on your crypto swaps, period. Think decentralized exchange aggregator, on steroids.

But that’s not all. UniswapX users also get to enjoy:

• Better prices
• Gas free swaps
• MEV protection
• Multi-chain support (coming soon!)

…to name a few. Read on to find out how it all works.

UniswapX gives better prices by aggregating liquidity sources

UniswapX solves the problem of fragmented liquidity, by incentivizing third-parties to connect all of these token sources to Uniswap. 

These third-parties are called “fillers”. 

In return for a small profit, fillers search the ecosystem for the best prices on any single trade – whether that’s from a Uniswap Protocol pool, or elsewhere. Then, they give Uniswap users the best value for their crypto swap. 

But what does this look like behind the scenes?

Say Alice wants to swap 1 ETH for USDC. She can get 997 USDC from Uniswap V3. 

1. With UniswapX, she also receives multiple offers from “fillers”, who happened to have found better deals elsewhere. The best offer, from Bob, is 1,000 USDC. 
2. She accepts the best offer, and the filler (Bob) sends her 1,000 USDC.
3. IF for any reason Bob can’t fulfill the order, it automatically updates to accept the next-best offer.
4. In this case, another filler (Danielle) steps in, fills the order for 998 USDC, and keeps a small profit.

This system ensures users get the best deal possible, period. No front-running by bots!

The best part of it all? From Alice’s point of view, this just feels like a regular Uniswap Protocol trade, with no extra steps. UniswapX handles all of the complexity behind the scenes. 

Gas-Free Crypto Swaps

UniswapX doesn’t just provide better prices for the trades. It also provides another game-changing feature: Gas-free crypto swaps. 

As you’ll know, you need to pay a transaction fee (known as gas) each time you make a trade on-chain. These fees can be expensive, especially during busy times. 

UniswapX changes the decentralized exchange game by allowing you to trade without worrying about gas fees. 

Instead, the gas cost is built into the swap price, which means you don’t need to hold extra $ETH just to cover fees. This makes trading more affordable and accessible to everyone.

There’s no cost for failed transactions, which is an absolute lifesaver in times of network congestion.

Note: You’ll still need to pay gas fees for certain actions, such as first-time token approvals. Wrapping native network tokens before selling them will also cost gas.

Protection Against MEV

Another big benefit of UniswapX is its protection against Maximal Extractable Value (MEV). 

MEV happens when bots or miners exploit the way decentralized exchange transactions are ordered on the blockchain to take some of the value from crypto trades. 

By outsourcing the complexity of routing trades to fillers, who compete to offer the best prices, MEV is no longer a worry. With UniswapX, any extra value that would normally be taken by arbitrage traders is given back to users through better prices. 

This competition drives down costs and ensures that users get fair prices for their crypto swaps.

Built for a Multi-Chain World

Uniswap Labs has built, and continues to build, for a multi-chain future. The Uniswap Protocol already provides deep liquidity for thousands of tokens across Ethereum and 10+ additional networks.

The Uniswap Wallet also takes the initiative of displaying all your assets across all supported chains – without needing to manually switch networks or adding chains.

UniswapX Will Do Cross-Chain Swaps

The next big step towards multi-chain compatibility is just around the corner. 

In the coming months, UniswapX will expand to support a variety of L2s, making gas-free cross-chain crypto swaps possible, creating connections between blockchains like never before.

This enables the launch of a new cross-chain version of UniswapX that combines crypto swapping and bridging into a single, seamless process. This will let users swap assets between blockchains in seconds, with the flexibility to choose which assets they receive on the destination chain.

This all comes while minimizing the usual security risks associated with using bridges.

How Does UniswapX Work?

Just like in a regular UniswapX swap, a cross-chain swap user places an order and different fillers compete to fulfill it. The filler who completes the crypto swap sends the requested assets to the user on the new chain. 

If they succeed, they get rewarded. If they fail, the user gets their assets back, plus a penalty from the filler.

Uniswap Protocol Is Growing Fast On Layer 2s

Uniswap Protocol is already gaining solid momentum on Layer 2 networks, which are becoming highly important for DeFi scaling. 

In the month of July, the Uniswap Protocol on Layer 2s saw more than 8.5 million active addresses – almost doubling the previous record month in June. 

Arbitrum has been a standout platform, racking up over $190 billion in swap volume on Uniswap Protocol since 2021.

Uniswap Labs is clearly staying ahead of the curve, keeping its dominance on emerging networks. By expanding rapidly on Layer 2s, Uniswap Labs is positioning itself as a leader in this new wave of DeFi, offering users faster, cheaper, and more scalable crypto exchange options.

With UniswapX’s cross-chain functionality yet to come, you can bet that Uniswap web app will cement its place as a leading Layer 2 decentralized exchange.

Uniswap X Conclusion

Uniswap Protocol is just as impressive under the hood as it is with its front-end innovations. With UniswapX, users get better prices, gas-free crypto swaps, and protection against MEV, with even more exciting multi-chain features on the way.

The platform’s already established a mighty presence on Layer 2 networks, and as UniswapX’s cross-chain protocol rolls out, Uniswap Labs is set to further cement its place as the leader in the next generation of decentralized exchange products.

Keep an eye out for updates on UniswapX and the upcoming Uniswap V4 release – both packed with new features!

UniswapX FAQ