Uniswap v3 Launches On BNB Chain After Months of Infighting

Uniswap, the leading decentralized exchange, went live on BNB Chain following months of infighting on Wednesday.

Uniswap Labs announced the launch of its v3 protocol on BNB Chain, saying the blockchain “typically offers faster and cheaper transactions than Ethereum,” making the exchange accessible to a broader user base.

BNB Chain, a blockchain created by the Binance exchange, is the second-largest smart contract network with a total value locked (TVL) of $5B, according to DeFi Llama. The network is compatible with the Ethereum Virtual Machine, meaning Ethereum developers can easily port their code.

The network has an adversarial history regarding Ethereum, with Binance seeking to siphon TVL away from Ethereum. BNB Chain is host to Uniswap’s top rival, Pancake Swap, which is a fork of Uniswap v2. Pancake Swap drove a total value locked of $2.5B, according to DeFi Llama, and a 24-hour volume of 159.7M, according to CoinGecko.

Uniswap is the fifth-ranked DeFi protocol with a TVL of $3.5B, according to The Defiant Terminal. Uniswap v3 drove $2.2B worth of trades over the past 24 hours.

Uniswap’s v3 iteration pioneered “concentrated liquidity”, a feature significantly improving the efficiency of capital utilization for DEXes, in May 2021 when it launched on Ethereum. The Uniswap v3 code was launched under a Business Source License, protecting its code against unauthorized commercialization for two years.

0xPlasma Labs, a DeFi platform, first published a proposal outlining plans to launch v3 on BNB Chain in December 2022. Uniswap governance passed the initial temperature check proposal on Jan. 22 with 80% support. 0xPlamsa predicted deploying v3 on BNB Chain would grow Uniswap’s TVL by $1B.

The debate continued within the Uniswap community during the lead-up to a final on-chain vote scheduled for Feb. 10 that would determine whether to implement the proposal.

GFX Labs, a crypto firm that participates in Uniswap governance, said that a BNB Chain deployment would benefit Uniswap by protecting it against unauthorized competitors deploying v3 on the network after its Business Source License expires in April.

“Within two months of Uniswap v3’s deployment, it took over most of Polygon DEX’s market share,” GFX added.

The proposal passed with two-thirds support, but Andreessen Horowitz (A16z), the largest venture capital firm in crypto and a major Uniswap investor, said it was unable to participate in a vote to determine v3’s bridging infrastructure provider for BNB Chain because of a technical issue.

The firm said it would have voted for its portfolio company, LayerZero, to provide bridging infrastructure for the BNB Chain deployment rather than Wormhole, and asked for the community to count 15M of its UNI as having been mobilized to vote accordingly.

Devin Wash, the founder of the Uniswap Foundation, rejected A16z’s request, and said Uniswap would move forward with the final vote count.
On Wednesday, Wormhole said v3’s BNB Chain Launch is a “significant win” for Uniswap and “an essential step towards a multi-chain future” for the broader DeFi ecosystem.