Uniswap v4 aims to lower startup fees and unlock DEX potential: UNI price jumps on news

Decentralized exchange (DEX) Uniswap has revealed that its long-awaited v4 update is set to launch in Q3 2024.

The new version uses Ethereum's upcoming Denkun update to streamline contract functionality and reduce gas fees.

TLDR

Uniswap v4 launch is planned for Q3 2024, Ethereum's upcoming Denkun upgrade v4 introduces “hooks” that allow custom logic to be embedded into smart contracts, enables dynamic adjustments and complex operations EIP-1153 temporary storage, enabling gas payment optimization. In order to minimize exchange fees like “flash accounting”, v4 code will be fully audited before launch to ensure security UNI price increased by 10% on v4 announcement, extending weekly rally to 15%.

Uniswap v4 introduces “hooks” that allow developers to inject custom logic into smart contracts at specific points. This enables flexible adjustments to pools, swaps, fees and other parameters as market conditions or platform needs change.

For users, Hooks promises lower exchange fees, better strategies for managing assets on Uniswap, and access to faster exchanges or other new features. Developers get more flexibility to build new DEX use cases compared to hard modern contracts.

Now that Denkun's mainnet launch is scheduled for March 2024, we're excited to update it for the community! ????

Uniswap v4 launch is tentatively set for Q3 2024.

From community-built hooks (to Events, to Twitter Spaces, to…

— Uniswap Foundation (@UniswapFND) February 15, 2024

A key enabler to facilitate V4 is Ethereum's EIP-1153, launched by Dencun in March 2024, which will allow temporary storage in contracts. This allows Uniswap to run “flash billing” when exchanging to significantly lower gas charges. In addition, the EIP-1153 opens up design options so that hooks can be integrated at lower cost at different points in the liquid pool life cycle.

To ensure a smooth launch, v4 code undergoes extensive auditing by internal and professional auditing firms before release.

A community code audit competition is also planned to ensure safety. The code is currently blocked while final modifications are made before rigorous testing begins.

The v4 announcement sparked a rally in Uniswap's UNI management token, with prices rising 10 percent to $7.60.

UNI posted a 15% gain for the week as traders awaited performance improvements from v4.

If Uniswap can deliver the promised gas reduction and flexibility using temporary storage and hooks, v4 of the DEX signature will greatly improve capital efficiency for liquidity providers while maintaining simple token exchange.

This could increase Uniswap's central role in decentralized finance and lead to another growth spurt in the adoption of the UNI token.