Uniswap V3 (Base)

What Is Uniswap V3 (Base)?

Uniswap V3 (Base) is the third version of the Uniswap protocol, which is a decentralized finance (DeFi) application on the Ethereum Layer 2 network built by Coinbase. It allows for automated transactions between cryptocurrency tokens on the Ethereum blockchain through the use of smart contracts. Swapping on the Base network with Uniswap V3 is similar to swapping on the Ethereum Mainnet.

What Are the Key Features of Uniswap V3(Base):

• Concentrated Liquidity: Provides liquidity providers (LPs) with more control over the price ranges in which their capital is allocated1.
• Multiple Fee Tiers: Allows LPs to be compensated for taking on different degrees of risk1.
• Capital Efficiency: LPs can provide liquidity with up to 4000x capital efficiency compared to Uniswap V2, potentially earning higher returns on their capital1.
• Low-Slippage Trade Execution: The increased capital efficiency can lead to trade execution that can compete with centralized exchanges and stablecoin-focused AMMs1.
• Improved Oracles: V3 oracles are designed to be easier and cheaper to integrate, providing time-weighted average prices (TWAPs) on demand for any period within the last ~9 days