Uniswap is a decentralized exchange protocol that is built on Ethereum to swap ERC20 tokens. It functions as an automated liquidity protocol, which implies that it does not follow the traditional “order book” model. It allows its users to swap tokens and trade without any intermediaries, thus ensuring a high degree of decentralization.
In simple terms, Uniswap is a framework that enables its users to swap tokens directly from their wallets without any intermediaries or custody. With Uniswap, you can use smart contracts to:
- swap tokens
- add liquidity/ provide liquidity
- remove liquidity from pools