L2 Stablecoin Opportunity Battle! Uniswap Votes for Optimism Version with Lowest Fee Tier at 0.01%, Far Below Curve

Ethereum Layer 2 solutions (L2) are seen as mainstream scaling solutions, with many major DeFi protocols deploying on L2 to attract users. The decentralized exchange protocol Uniswap launched on Optimism, one of the L2 solutions, in July 2021. According to DeFi Llama statistics, Uniswap's Total Value Locked (TVL) on Optimism reached a value of $37.1 million.

Why Join the 0.01% Tier?

Uniswap v3 adopts custom pricing liquidity, allowing liquidity providers to maximize fee revenue through appropriate pricing strategies, unlike the fixed fees of Uniswap v2. Additionally, you can choose to join/create liquidity pools with different fee tiers.

It even informs you of how much liquidity there is in different fee tiers and what kind of trading pairs are suitable. In the example below, a 0.01% fee is recommended for stablecoin trading pairs.

As for why use 0.01%? This brings us to the king of on-chain stablecoin exchanges, Curve Finance, with its Ethereum 3 pool USDT-USDC-DAI having $9.758 billion in liquidity, with fees set at 0.01%; the Ethereum version of Uniswap v3 also mentioned the competitiveness of stablecoin pools and transaction fees in a proposal last year.

Tracking the analytical chart, you will find that the Ethereum version of Uniswap v3's trading volume for USDT-USDC, after implementation, significantly increased and even temporarily surpassed Curve. Currently, Curve holds 56%, while Uniswap v3 is at 31%.

Currently, Curve's fee on the Optimism 3pool is 0.04%. If Uniswap's proposal is approved, it may put pressure on Optimism's version of Curve. Although there isn't much capital on L2, Uniswap clearly aims to continue capturing stablecoin trading business in this new battlefield.