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The Decentralized services began to evolve as many DeFi applications and protocols were being developed. The DeFi exchange, like Uniswap, is designed mainly for the transaction exchange of ERC20 tokens to ETH tokens. Compared to other decentralized exchanges, the Uniswap protocol uses liquidity pools rather than order book models. If any new decentralized exchanges occur in the DeFi platform, it faces liquidity problems, so to overcome this, the Uniswap like protocols choose liquidity protocols for exchanging ERC tokens. Smart contracts for secure transaction purposes block the liquidity pools and, in turn, protect Uniswap from unwanted hacks.
Efficient characteristics of Decentralized Exchange in Uniswap :
Non-custodial process: The ownership of crypto assets doesn’t get reversed in any situation.
Automated Process: Instant DEX trading happens since it has sufficient liquidity funds with no intermediaries involved.
Cost-effective Process: The users can swap assets at little to no cost since decentralized exchanges have low trading fees.
Worldwide Accessibility: The DEX doesn’t require any sign-up process to access the trading platform, and there will be no risk associated with it.
Instinctive Process: The latest DEX trading platform evolves with just order books to simple points and taps to swap.
Pseudo-unidentified process: The users can kickstart their trading by connecting their choice wallet with no pre-requirements updation like a profile or background details.
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