In this article, you will get a brief understanding of what Uniswap is, its revolutionary solution to a major market issue, and why so many people are excited about it.

How (a lack of) Liquidity can hurt investors

Centralised exchanges such as Coinbase and Kraken have been the major hubs of cryptocurrency trading. These platforms are administered by a single authority (the exchange operator), require users to place funds under their custody, and permit trading using a typical order book system. The exchanges operate as custodians, holding users’ assets on their behalf. Benefits include efficient settlement time and trading volume. However centralised exchanges use the order book model where the price of an asset listed on the exchange is determined by where the highest price someone is willing to pay and the lowest price someone is willing to sell is matched. The key issue in the order book model is liquidity....