UNI - V3 launched, how now brown cow?

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Sanfam
May 10, 2021


Uniswap V3

Post launch

Now that Uniswap V3 has launched, what do people think of it?

The V3 experience

In summary,

  • TVL on V3 may be lower than V2 (TVL might not be a good measure going forward) may due to capital efficiency. Volume is impressive these few days (but could be largely driven by craze over $SHIBU).
  • Capital efficiency is great but V3 remains sophisticated and confusing for most existing/new Uniswap LPs to understand/setup.
  • Gas fees are still too high for Swapping, Migration, Setting ranges and pretty much everything. Here's reddit thread to summarize the pain.



Price

UNI price action - Sanbase

No surprises here as the usual "Buy the rumour, sell the news" happened once again as we saw a nice run up to $44 two days just before the launch date. It appears there were some frontrunners as well as the price dipped 1 day before launch.


Once the news was out, down it went. So far, it has found a local bottom at around the $38.80 area and is making its third attempt to break out of the $40.80 resistant area.


Interestingly, the "dump on news part" isn't as bad as one would expect. However, this could be due to another speculative event that's in play - Uniswap L2 solution on Optimism to come in mid-May.


Whether it'll be delayed or not, it's anyone's guess.


There's no confirmed date at the moment, and it actually works well for speculation. A surprise launch should see sudden price spike as market comes backs in, till then, it's a wait and see game.



Supply on Exchanges

UNI Supply on Exchanges - Sanbase

Over all, UNI has enjoyed a good 6 months of decreasing Supply on exchanges which resulted in less sell pressure available and indicates that the market is in Accumulation/HODL mode instead (Everyone was pretty much waiting for V3)


Naturally, UNI's price enjoyed a nice rally too. However, we are starting to see signs of increased Supply on Exchanges as we the V3 launch drew near, since then then it has dropped but it's worth keeping an eye out if we see yet another higher high for Supply on Exchanges. Afterall, once the speculation juice (Uniswap on L2) runs out... the question remains what else is there to speculate on?




Daily Active Deposits (DAD)

UNI Daily Active Deposits - Sanbase

Following the major blow off top in late Feb 2021, UNI's Daily Active Deposits have been shrinking, which suggests that most dumpers have exited then.


That said, we are seeing increased DAD spikes as each new UNI price spike happens, indicating that market participants are increasingly ready to take profits as price creeps up.



Network Growth

UNI Network Growth - Sanbase

Network growth can often be used as an indicator for how intense new retail money is stepping in. The start of the year saw a very nice uptrend in new retail money into UNI but increase levels have dwindled since Feb's blow off top.


We are now seeing a new wave of participants from the uptrend in Network Growth since April. This is healthy for UNI's growth and continued momentum should lead to an impulse move in price as well. Which, usually results in a blow off top.



Going forward

The much anticipated Uniswap V3 release have been a lacklustre one for most people thanks to high fees and high learning curve.


However, UNI's price is still holding key levels as market participants await in anticipation (Mid-May) for Uniswap V3 on L2 in hopes that it'll help resolve users' biggest painpoint so far - FEES, FEES, FEES.


Recent Network grow is encouraging but Supply on Exchanges is worth keeping an eye on as well.

UNIDEFI
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Sanfam
May 10, 2021

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