Uniswap Labs, the team behind the decentralized exchange Uniswap, has announced its vision for its Uniswap V4 iteration, including hooks and custom pools, better architecture and gas savings, and license and governance. The Hooks add fresh functionalities to liquidity pools, such as adjusting fees dynamically and new order types creation.
Uniswap Labs shared the information on Twitter:
1/ Today, we’re announcing our vision for Uniswap v4 🦄
— Uniswap Labs 🦄 (@Uniswap) June 13, 2023
We see Uniswap as core financial infrastructure & think it should be built in public with space for community feedback and contribution.
An early implementation of the code can be found here:https://t.co/toy3k7plnU pic.twitter.com/9vGJElba2x
The code draft for Uniswap V4 is made available publicly, encouraging open feedback and active community involvement in its development. The process is expected to span several months to ensure meaningful contributions and improvements.
Uniswap V4 is reported to introduce ‘hooks,’ which are contracts that run at various points of a pool action’s lifecycle. Once implemented, the V4’s hooks feature would enable future developers to introduce a range of innovations, including on-chain limit orders, automatic deposits to lending protocols, and auto-compounded liquidity provider (LP) fees.
Uniswap’s founder, Hayden Adams, proclaimed in the blog post:
In v4, we hold all the pools in one singleton contract, which will provide important gas savings because swaps will no longer need to transfer tokens between pools held in different contracts.
Preliminary assessments indicate that v4 decreases gas costs for pool creation, reducing them by 99%. Further, the v4 also reintroduced support for native ETH, enabling further gas savings.
Adams asserted that the move is merely the initial protocol implementation with a feature of seeking feedback from the community for future tweaks. He added,
It’s really here as an initial implementation of this protocol and a vision for what it will be, but it’s not finished. There’s time for people to give feedback, time for people to find improvements and optimizations, time for people to also start preparing to build on top of it.
Notably, Uniswap V4 has introduced a new “flash accounting” system, enhancing the singleton architecture and enabling efficient transfers based on net balances. This not only improves the overall system efficiency but also delivers additional gas savings for users in Uniswap V4.
The code for the V4 would be made available under the Business Source License 1.1, initially limiting commercial or production use for up to four years. Afterward, it is anticipated to convert to a perpetual GPL license, with exceptions granted by Uniswap Governance and Uniswap Labs.
