"V3 is Winding Back a Bit of the Uniswap Revolution; It's Going to be Very Influential" Dan Robinson

In this week’s episode we speak with Dan Robinson, a research partner at Paradigm, one of the most active VC funds in DeFi and crypto. One of the fund’s investments is Unsiwap, where Dan also had a central role in the design of v3, the latest version of DeFi’s most popular decentralized exchange. Dan talks about why Uniswap was so exciting as an investment. He said at the time, many blockchain applications still involved some centralized parties and custodied funds. But Uniswap was really hands-off; A self-contained system with no admin keys.

But the issue was that it wasn’t very capital efficient, meaning funds in liquidity pools for any given trading pair would go mostly unused. And that’s what they set out to solve with V3. The solution Dan helped find was concentrated liquidity, or the idea of concentrating funds at the price range where an asset is traded the most.

Dan talks about his big ambitions for Unisiwap -- he believes that most liquidity will move to Uniswap v3 and that the new concentrated liquidity design will have an influence on the whole DEX space as more projects start to optimize for capital efficiency. It will also roll back the revolution Uniswap itself prompted, and move AMM (automated market maker) design into an order-book hybrid.

We also talk about miner extractable value and how he sees projects are evolving from those trying to democratize MEV, to those trying to stop it from ever happening. We talk about his views on governance and how he believes protocols should try their best to minimize decision-making. His main area of focus continues to be on AMMs. In the long term, he believes they will have an impact on investment similar to what exchange-traded funds did to stocks, allowing anyone, from big institutions to small individual investors, to earn a passive income by providing liquidity, something that only large market makers could do before.

Transcript
https://newsletter.thedefiant.io/p/v3-is-winding-back-a-bit-of-the-uniswap

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