Decentralized Exchanges: Why Crypto’s First Killer Apps are So Powerful - DeFriday #12

The Uniswap decentralized exchange does over $1b in daily cryptocurrency exchanges. 

It holds $7.55b worth of cryptocurrency in its smart contracts. Not in a bank account, or on a centralized exchange like Coinbase, but in lines of code running on the Ethereum blockchain.

What Coinbase does with 1,700 employees, Uniswap does much of with 13. The protocol runs completely autonomously, trades happen with no human involvement, prices are set automatically, liquidity is added and removed by anyone in the world, and support happens organically in their Discord. 

Decentralized Exchanges like Uniswap are one of the first killer apps in crypto. They’re replacing a core piece of the Traditional Finance infrastructure, and doing it with 1/100th the headcount. 

And they’ve provided an essential piece of the crypto infrastructure. Before Uniswap and other DEXes came on the market, the only way to buy a new crypto token was if a Centralized Exchange (CEX) like Coinbase listed it.

But today, you can create a new token and add the necessary liquidity to Uniswap, and your token is immediately available to anyone in the world. No gatekeeper approval required.

Many people have heard of Uniswap and have some concept of the idea of Decentralized Exchanges, but you might not know why they’re so cool and how they work. So in this post, I’ll walk through what makes them so valuable and how anyone can use them. 

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