I think we all need to take a moment to recognize what Uniswap has done for the entire cryptosphere. It truly is a sight to behold. They single-handedly created an OPEN-SOURCE product that added massive value to everything.
Uniswap was clearly the first and most popular protocol to normalize AMM (automated market maker) technology. I used Uniswap several times before even realizing how it worked or even how important it was. Much like google, their simple interface of allowing users to trade one coin for another was all I needed, so I never looked any further than that.
Uniswap added so much instant liquidity to the market that value spilled over into every single ERC-20 token on Ethereum and even into networks outside of Ethereum. It's already been cloned over a dozen times, and as we've seen, Pancake Swap and even the entire Binance Smart Chain could not really exist without it.
So much value was created with Uniswap that it affected the markets in ways that were never even considered. For example, before Uniswap became a thing the interest rates for minting DAI were absurd. This is because there was very little reason to hold DAI other than dumping it for more ETH and margin trading.
Now that Uniswap and defi yield farming are a thing the demand for DAI has increased exponentially. Half of all pools paired to DAI must lock DAI in order to farm and provide liquidity. This exponential increase in demand in turn increased the price of DAI, forcing makerDAO to lower interest rates, making it way cheaper to mint DAI while still maintaining a stable price.
There are many events like this that happened as a result of Uniswap that will perhaps never even be recognized. Economies are complicated and there are a lot of moving parts/variables. It's impossible to say how certain things came about: but it is quite clear that Uniswap has created immense value within the cryptosphere dozens of times.
Synergy is key
Uniswap is the perfect example for showing why and how this emergent open source economy can and will create exponential value going forward. Uniswap's mechanics allow it to generate plenty of value for itself, while also not having to rely on intellectual property laws to stifle innovation and progress. Anyone can use the code for any reason and no one is going to say boo. This is the value of fully permissionless/borderless networks.
We can all freely build and create value on top of the systems we've already created. When compared to the legacy systems it's easy to see why permissioned ownership absolutely can not compete with open networks. The potential to scale open networks is exponentially greater than a closed system. This is why enterprise blockchain will never go anywhere, no matter how many billions get pumped into it, just like intranets/extranets went nowhere in comparison to the Internet. There is no incentive for innovators to build on top of a closed system.
Conclusion
I think that's all for now. Still attempting to work diligently on my own Magitek project. Fixed an infinite loop issue recently. Been a while since I've crashed a program with such a blatant fatal error. Perhaps that's worth its own post. Perhaps not.
The main point here is that all of the value we are building today will continue to snowball into the future. You can't get that in the legacy economy. Permissioned systems do not scale, and corporations/governments always become top-heavy and collapse if they become too large and bloated from their own corruption and complete lack of fair distribution. Flat-architecture is the key to building a sustainable world that values long-term success over short-term sellouts.
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Return from Uniswap Unicorn to edicted's Web3 Blog
