UNISWAP V2

please can some of the smart anons who still post here redpill us on uniswap

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Other urls found in this thread:

cointelegraph.com/news/bancors-upcoming-v2-upgrade-to-solve-defis-dirty-little-secret
twitter.com/haydenzadams/status/1255584208631861250?s=20
mesa.eth.link
twitter.com/NSFWRedditGif

it needs more liquidity

You are the worst kind of zoomer. Born with all the benefits and luxuries of the internet. But still can't google that shit. Do better user. Better yet, ask a pointed question instead of asking us to feed you tendies.

Normies love easy shit and unicorns.
buy early and expect 10x.

How does price appreciate without order books?

If you provide liquidity you get some dollar dollar sign from fees, that is if you put in at same price as you take it out

Liquidity pools. Look it up.

you're right, im sorry.
OK how about this: plz redpill us on "impermanent loss". Guys at Bancor and many other teams claim to solve it, eg cointelegraph.com/news/bancors-upcoming-v2-upgrade-to-solve-defis-dirty-little-secret , but the lead guy from Uniswap, Hayden, says it's never truly solved: twitter.com/haydenzadams/status/1255584208631861250?s=20

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add liquidity - 10 eth and 1000 link (assuming link is at 0.01)
some fag buys 10 link
this ratio has to keep same:
10 * 1000 = newEth * 990
newEth = 10000/990
newEth = 10.101

something like this

So price is dictated by liquidity/volume rather than what the two parties are willing to buy/sell it for? Seems like this approach woudlt fair well in a bull run or ever allow one to begin

impermanent loss is the "loss" you have providing liquidity vs just holding the underlying assets. Your liquidity is constant, so if the price goes sideways for a while you rack up fees and your underlying assets don't appreciate or depreciate in value. This is a net positive.

However, if the price of one of the assets increases due to buy orders, your equation is rebalanced in favor of the other asset (meaning you have less of the asset that is rapidly appreciating) If there isn't a lot of volume then the fees you get won't cover the "loss" you experienced in profit that you could have had if you were just holding.

TLDR: its good if market crabs, bad if it raises a lot or crashes a lot. It's called impermanent cause if you get back to your original entry point you come out with the same amount of underlying assets+fees.

>dexes: while trades are onchain sec sends letter to makers and ethdelta/idex=dead
>uni: liquidity pool where algo turns shitcoins swaps into bids//asks and finds price, sec sends letter to makers nothing happens because its truly automated and decentralised
So tldr?
Uniswap is piratebay for shitcoins today and piratebay for EVERYTHING (nfts, tokenization) tommorow

Its single most bullish thing eth pooped out (yes more than icos and defi) and somehow noone is mindblown true proof of clownworld

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interesting. thanks a bunch user.

Do you think impermanent loss is an overly euphemistic name for what's going on? "Impermanent" made me think it was temporary and therefore no big deal. but based on what you said, it seems the opportunity cost of using Uniswap liquidity pool vs. just holding your crypto could be massive (ie. you could miss out on tons of gains by using liquidity pool)?

Uniswap is the killer app of ethereum

it's using price oracles. not chainlink of course, because uniswap is a decentralized project.

>"Impermanent" made me think it was temporary and therefore no big deal.
It's impermanent because it goes away if the exchange rate returns back to where it was when you started providing liquidity.

>it seems the opportunity cost of using Uniswap liquidity pool vs. just holding your crypto could be massive
Sure, but markets don't exist if no one makes them.

its a massive deal, it depends on the price point that you provide liquidity at. Imagine, for example, you are providing liquidity to eth/USDC when eth was just launched at around .14c or something. Eth is now at $200. You would have had a massive loss in the amount of eth assets you would have held as more and more of the equation got rebalanced towards USDC. If you had just held all your eth originally, you would have made a shit ton of money. But now, you have less eth (much less, dont feel like doing the math) and more USDC+fees. For this guy, providing liquidity early on was a massive downside.

Look at the other example. Eth is now trading at 200 bucks. You provide liquidity to eth/usdc at the current price. IT crabs around 180-210 constantly. Your assets depreciate, but then they reappreciate. If this crab continued for a while, you would make money on fees while the "loss" you experienced isn't that much. This is a more attractive scenario and the "loss" isn't that bad cause the price swings within a narrow band. However, if eth continued to rise and broke 500 or something, it would turn into another bad deal for you.

Generally speaking, the fees aren't really ever enough to cover price appreciation unless you've been getting a high volume crab for a very long time before the price goes up.

I don't get why this is a problem. If you're offering your asset to the liquidity pool, aren't you essentially entering a "sell order"? If someone buys it and price goes up, why shouldn't you have less of the asset? Seems like you're just on the wrong side of a trade, like literally half the people making trades at any given time.

google is shit
duckduckgo is king

>Imagine, for example, you are providing liquidity to eth/USDC when eth was just launched at around .14c or something. Eth is now at $200.
How is this different than saying "I would have had more money if I had sold ETH at $200 rather than 14c"?

that's the point. These people are trying to help a market grow, and now they are losing out on money they could have had if they didn't help the market grow. Why can't you see how this removes incentive to provide liquidity for market makers if they feel the coin will appreciate/depreciate in value? Would you in this situation rather have held onto your eth or provided liquidity and come out significantly poorer?

I would rather hold my ETH but that's because I'm a permabull. Anyone who thinks ETH is overvalued at $200 should be happy to provide liquidity, just like they should be happy to enter a regular sell order. If no one thinks ETH is overvalued at $200, price should go up. What's the problem?

uniswap2

advantages
allows for token-token pairs (like dai/usdc) - this is going to be great for liquidity
adds twap price feeds (kills link for all prices for tokens that trades on uniswap)

disadvantages
higher gas costs for eth pairs compared to uniswap1

Thats not problem " losing out on money they could have" is saying you can time tops and bots also marketmakers dont "feel the coin will appreciate/depreciate"

You provide liquidity usdc-eth

Eth moons you still have half eth that mooned and you have oportunity cost for half of eth stack
Eth crabs/goes a bit down you bank on fees

You make money either way longterm you just hedge bets so its not win/loss scenario but half win//small win scenario

this is literally market making 101

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Yes because we are poor

Market making is for rich to make moneny whitout making bets

I think the better alternative to uniswap is mesa.eth.link
it's a dex that works by organizing a batch auction every few minutes.
The biggest problem with uniswap is frontrunning and mesa solves this.
It was made by gnosis and it's also 100% decentralized.

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now you understand though, there isn't anything "wrong" but you are 100% never going to provide liquidity. Anyone who is bullish on a token will not provide liquidity. People are more inclined to remove liquidity when they start to see long term bull potential. The point is that it adds risk to a market and makes people less likely to participate in the market for that coin.

RPL is a great example. biz had a MASSIVE pump in rpl, bringing the price from below a dollar up to 3.50. one of the whales saw the massive price appreciation and withdrew all his liquidity to the tune of 1 million dollars withdrawn. the liq pool is around 250k now. It's an isolated example, but you can see that overall it is an issue for a lot of people. If it was solved, people would be able to participate in market making while earning fees at literally zero risk to them. It would make DEXs have ridiculous liquidity and they could compete with major exchanges. I don't think it's solveable atm though...AFAIK the solution from bancor involves just giving you tokens that you can sell to cover the impermanent loss.

it's a problem because people don't participate then, jesus. You make money either way, but you *could* have more. That possibility makes providing liquidity unattractive to most people.

Market makinng is not for moss people mm is for rich to make moneny whitout making bets so yes.

Its not maximize profits poorfag job its keep fat stacks and make them grow job

You could lend a stable coin on aave to earn 3-4% apr if you don’t want to miss out on potential gains with eth or other shitcoins