What Uniswap is
Uniswap is an automated market maker (AMM) protocol launched in November 2018 by Hayden Adams. Instead of a traditional exchange's order book it uses liquidity pools: anyone can deposit a pair of tokens and earn a share of the fees, and anyone can trade against those reserves, with the price set by a formula. Versions have followed one another (v2 in 2020, v3 in 2021 with concentrated liquidity, v4 in January 2025 with "hooks", programmable modules enabling dynamic fees and on-chain limit orders) and the protocol is now deployed on about 47 networks, including Ethereum, Arbitrum, Base, Polygon, Optimism, BNB Chain and Unichain, the layer-2 network launched in 2025 by the same ecosystem, which in 2026 handles nearly half of v4 volumes.
The UNI governance token was distributed in September 2020. On 25 December 2025 governance approved the "UNIfication" proposal: activation of protocol fees, the burning of 100 million UNI from the treasury and an automated mechanism that uses protocol revenue and Unichain sequencer revenue to burn tokens. Uniswap Labs (New York) develops the web interface and the wallet; the Uniswap Foundation funds ecosystem development.
Regulation and licences
In April 2024 Uniswap Labs received a Wells notice from the SEC; in February 2025 the Commission closed the investigation with no action. In September 2024 the company instead settled a CFTC complaint over leveraged tokens offered through the interface, paying 175,000 dollars. In Europe MiCA does not apply to fully decentralised protocols with no intermediary, but interfaces and services run by companies remain in scope: using Uniswap requires no authorisation, while those offering services on top of the protocol may need one.
Security
The core contracts are among the most audited and tested in the industry and have not suffered direct breaches. The risks for users lie elsewhere: fake tokens with names identical to real ones, clone sites of the interface, spending approvals granted to malicious contracts and, for liquidity providers, "impermanent loss", the lower return compared with simply holding when prices diverge. Practical rule: check the token's contract address, use only the official interface or trusted wallets, and do not leave unlimited approvals.
Costs
The protocol charges fees per pool, typically between 0.01% and 1% of the trade, which go to liquidity providers and, since 2026, partly to the burn mechanism. Uniswap Labs' interface and wallet add a 0.25% fee on swaps of many pairs. On top of this comes the gas of the network used, far lower on layer-2 networks than on Ethereum.
Alternatives
The Directory lists Dolomite, a DeFi trading and lending platform. To trade with a compatible wallet, MetaMask; to analyse pool volumes and liquidity, Dune.
FAQ
Does Uniswap hold the funds? No. The swap takes place between the user's wallet and the protocol's contracts; no company holds the funds.
What is the fee switch? It is the activation of protocol fees, voted in December 2025: part of the fees no longer goes only to liquidity providers but feeds the burning of UNI.
Is Uniswap legal in the EU? Using the protocol is not prohibited; MiCA rules concern intermediaries offering services, not users trading from their own wallet.
What is Unichain? A layer-2 network on Ethereum launched in 2025 by the Uniswap ecosystem, designed for fast and cheap swaps; its sequencer revenue contributes to the UNI burn.
(Verified: September 2026)
Verified sources
- https://www.theblock.co/post/347172/uni-token-holders-approve-165-5-million-in-new-foundat
- https://en.cryptonomist.ch/2025/02/26/the-sec-officially-closes-the-investigation-on-unisw
- https://www.cftc.gov/PressRoom/PressReleases/8961-24
- https://about.uniswap.org/
- https://www.datawallet.com/crypto/what-is-uniswap
