A new blockchain is entering the crypto market as the largest decentralised exchange (DEX) in the Ethereum cryptocurrency segment, Uniswap Labs is launching its own L2 blockchain, Unichain. The layer 2 blockchain announced by the DeFi company seeks to boost the efficiency of DeFi transactions, speeding up DeFi services.
This development marks a major leap for the crypto company, as it revolutionised DeFi since Uniswap started operations in 2018. An official statement from Uniswap said, “Unichain will initially have one-second block times and will later be optimized to meet 200–250 millisecond block times.” With this near-instantaneous transaction, the company is trying to address the time lag in blockchain networks.
In recent times, layer 2 blockchain has emerged as a favourite amongst crypto exchanges as it is easily scalable, unlike other types of blockchain networks. L2 solutions like Unichain can compile DeFi transactions and process them in batches on the main Ethereum blockchain network. This helps in relieving congestion-related delays and substantially reducing transaction fees.
Uniswap’s new venture is in line with the ongoing trends in the cryptocurrency market, as similar projects like Coinbase and Arbitrum have launched their own L2 technologies to scale up the Ethereum blockchain. However, the L2 blockchain initiated by Uniswap Labs holds more promise as they are the most widely used tool in the DeFi ecosystem. This is because of the open-source nature of their system, which can be compared to SMTP for email. The company is creating a proprietary client similar to Gmail by launching Unichain, as it is open-sourced and has enhanced features that will help users.
Speaking about the matter, Uniswap Labs Chief Operating Officer, Mary-Catherine Lader, said, “Unichain will in time make using DeFi less clunky for users and also increase liquidity across the industry." Ladder added that De-Fi tools will find more acceptance in the world of traditional finance.
The COO underlined the principle behind Unichain, saying that Uniswap considered the Apple adage that stressed the importance of hardware in building software. The company had similar ideals in mind in creating its L2 blockchain to promote low cost and decentralization in the crypto sector. The Unichain system is constructed on the L2 technology called Optimism used by Base and others.
At present, Uniswap is in its third version after the DeFi protocol went through multiple iterations since self-taught programmer Hayden Adams launched it in 2018. In 2022, the company received $165 million in Series B funding, which was same as the Uniswap’s market value.
The company’s new L2 blockchain will dramatically revolutionise the DeFi landscape as it reduces costs and improves transaction speed, eradicating barriers and making way for more DeFi technology adoption in mainstream finance. Uniswap is bolstering its position as a crypto innovator by launching this fast and cost-effective L2 solution, which speaks for the company’s commitment to the changing dynamics of the crypto industry.