Popular, decentralized automated market maker (AMM), Uniswap, will use its smart contracts to deploy on Polygon. This is the Ethereum scaling solution and Proof-of-Stake chain. Following a vote from the community, the official Twitter handle of Uniswap Labs made the announcement.
Uniswap Community Reacts Against The New Proposal, Here is Why| Uniswap Community Reacts Against The New Proposal, Here is Why
As per the original proposal, AMM would be rolled out on Polygon when it reaches its third iteration. With 72 million votes for and 503,009 in opposition, the motion passed. This suggests that the proposal is well-received by UNI holders.
🗳The Uniswap Community voted to use v3 @0xPolygonThrough the governance process.
⚡️Uniswap Labs is expected to deploy Uniswap v3 within a few working days.
👀Stay tuned. pic.twitter.com/LwVLwEngPl
— Uniswap Labs 🦄 (@Uniswap) December 18, 2021
Presented on November 19Th by Mihailo Bjelic, one of Polygon’s co-founders, claiming it’s “the right moment” to carry on this community driven initiative. Bjelic claimed Polygon has one of the “strongest DeFi ecosystem”, that the implementation could boost Uniswap’s user base, and promised users that they will incentive adoption to achieve that goal.
We initiated the final phase of the governance process – On-chain Vote: https://t.co/PcHcnrcj2u.
Vote yes to confirm deployment. 🤗
The Uniswap community is hugely appreciated for all of their support.
Let’s do this! 🦄💫 https://t.co/RePmCRaBlb
— Mihailo Bjelic (@MihailoBjelic) December 10, 2021
As a scaling solution for Ethereum, Polygon can also provide users with a “battle-tested” and cost-efficient implementation of the popular AMM. Uniswap ruled the DeFi ecosystem until transaction fees made it prohibitive for large numbers of users to use the protocol.
Bjelic also pointed out that Polygon is the preferred scaling option for other Ethereum protocols. While mentioning Aave and Curve as well as SushiSwap and Balancer among others, the co-founder also highlighted the many benefits of Polygon’s ecosystem.
Besides the impressive number of deployed projects, additional strength of Polygon’s DeFi ecosystem is that it is already self-sustainable. Although we have effectively ended all liquidity mining incentives a while back, we continue to see capital and user flow 25 as well as very high retention 14.
Bjelic also claims that Polygon protocols have seen an increase in use. Aave has reached 700,000. Active users after their deployment on the network. This is a 10x higher number than that of Ethereum.
Uniswap and Polygon to Onboard Thousands of New Users
Most users believe that Polygon will reduce the cost to use Uniswap. The co-founder of this scaling solution claimed that Aave also experienced a 16x increase in its user’s activity.
Bjelic further argued that the integration between Uniswap v3 and Polygon’s PoS will represent a comeback to the original “DeFi vision”. This sector was designed to give people access to open and inclusive financial options. He also said that:
DeFi is an open and inclusive financial system. Polygon deployment (and other scaling solutions), can be considered a way to return to that original vision.
Polygon is exploring the possibility of committing around $20 million to their treasury in order to provide liquidity incentives. The practice was dropped by the project. However, Bjelic said that they would be willing to resume Uniswap for liquidity incentives because it is a key DeFi protocol.
The funds will be distributed as follow: $15 million might be allocated for long term liquidity incentives and $5 million for a “special purpose DAO”. This organization’s goal is to improve Uniswap adoption in Polygon.
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UNI currently trades at $15.99 with 10.3% gains in the previous day.