Uniswap v4 Shakes Up DeFi with Custom Hooks and Lower Costs

Uniswap’s latest upgrade is live, and it’s bringing a fresh layer of flexibility to decentralised finance. Users can now provide liquidity on v4 through the Uniswap web app, with swapping rolling out in stages as liquidity moves over. The protocol is available on Ethereum, Polygon, Arbitrum, OP Mainnet, Base, BNB Chain, Blast, World Chain, Avalanche, and Zora Network.

What sets this version apart is its shift towards a developer-centric model, enabled by a new feature called hooks. These modular contracts allow developers to customise how pools, swaps, fees, and liquidity provider positions interact. With more than 150 hooks already created, the potential for innovation appears limitless. Dynamic fees, automated liquidity management, and other advanced trading tools are already taking shape. By turning Uniswap into a platform where developers can experiment freely, liquidity deepens and the number of transactions grows.

Efficiency is another highlight. The cost of creating pools on v4 is estimated to be 99.99% lower than before, significantly reducing barriers for liquidity providers. Multi-hop swaps will also see reduced gas fees, making trading more affordable. Native ETH support further cuts costs, particularly for ETH trading pairs. The technical details of these savings are outlined in the v4 whitepaper, which explains how the protocol optimises gas usage and execution efficiency.

Security has been a major focus. Uniswap v4 follows a lineage of protocols that have processed more than $2.75 trillion in trades without a single hack. This version underwent extensive testing before launch, including nine audits, a security competition with over 500 participants, and the largest bug bounty in DeFi history, offering up to $15.5 million for critical vulnerabilities. None were found. The bug bounty remains open, encouraging ongoing scrutiny of the codebase even after deployment.

Users can access v4 through the Uniswap web app and wallet. Swappers will soon be able to trade using the new system without changing any settings, as transactions will automatically route through UniswapX, v2, v3, and v4 liquidity pools. Liquidity providers can migrate existing positions or create new ones with hooks. Developers interested in building with v4 can explore the available documentation and guides.

This latest update follows Uniswap’s track record of continuous development, keeping decentralised finance adaptable and competitive. With hooks providing a foundation for new features and gas savings making transactions more accessible, v4 is designed to handle the next phase of DeFi growth. The community’s involvement in shaping and securing this release reflects the open-source spirit of the project, setting the stage for further innovation. Whether through deeper liquidity, lower costs, or novel trading mechanisms, Uniswap’s evolution continues to reshape decentralised markets.

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Maria Irene
Maria Irenehttp://ledgerlife.io/
Maria Irene is a multi-faceted journalist with a focus on various domains including Cryptocurrency, NFTs, Real Estate, Energy, and Macroeconomics. With over a year of experience, she has produced an array of video content, news stories, and in-depth analyses. Her journalistic endeavours also involve a detailed exploration of the Australia-India partnership, pinpointing avenues for mutual collaboration. In addition to her work in journalism, Maria crafts easily digestible financial content for a specialised platform, demystifying complex economic theories for the layperson. She holds a strong belief that journalism should go beyond mere reporting; it should instigate meaningful discussions and effect change by spotlighting vital global issues. Committed to enriching public discourse, Maria aims to keep her audience not just well-informed, but also actively engaged across various platforms, encouraging them to partake in crucial global conversations.

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