Uniswap Labs, the corporate entity that builds products to use the decentralized finance (DeFi) protocol of the same name, announced on Thursday the launch of a so-called Layer 2 blockchain. The new blockchain is called Unichain and, according to the company, it will significantly speed up the time it takes to carry out transactions on its decentralized exchange.
“Unichain will initially have one-second block times, and will later be optimized to meet 200-250 milliseconds block times. This will feel like a near-instant transaction experience for the user,” said Uniswap Labs in a statement.
Layer 2 blockchains, knowns as L2s, have proliferated in the last few years and include services like Arbitrum and Coinbase’s Base. They work by compiling transactions and recording them as a batch onto the main Ethereum blockchain, a process that minimizes fees and avoids delays due to congestion.
The decision by Uniswap Labs to launch an L2 of its own is significant because Uniswap—an open source protocol akin to SMTP for email—is the most popular tool for DeFi, which relies on modular, Lego-like tools to carry out trades without a centralized authority. Using the email analogy, Unichain is like Gmail or another client built on the open protocol.
In an interview with Fortune, Uniswap Labs COO Mary-Catherine Lader, said Unichain will in time make using DeFi less clunky for users and also increase liquidity across the industry. A former banker with BlackRock and Goldman Sachs, Lader predicts DeFi style tools will increasingly be adopted by the world of traditional finance.
According to Lader, Uniswap Labs built Unichain with a mind for the Apple adage that building great software requires great hardware, and that the company’s philosophy is based on simultaneously pursuing the crypto ideals of speed, low cost and decentralization. Unichain itself is built on the L2 technology known as Optimism, which is used by a popular L2 of the same name and by Base among others.
Uniswap was created in 2018 by self-taught programmer Hayden Adams, who has since developed a second and third version of the protocol. In late 2022, Uniswap Labs raised a $165 million Series B funding round that at the time valued it around the same amount.
Uniswap created the new L2 blockchain with the help of the DeFi research and development organizations Flashbots and OP Labs.
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