What is different about Unichain, the L2 network launched by Uniswap?

Author: Felix, PANews

Recently, Uniswap developer Uniswap Labs announced the launch of its own L2 network Unichain on Ethereum and released a white paper. The network is built on OP Stack technology and is scheduled to be launched on the test network today, and the main network will be launched later this year. Uniswap said the chain is expected to provide faster and cheaper transactions and enhance interoperability across blockchain networks.

Developed in collaboration with the Uniswap Foundation, Optimism and Flashbots, Unichain will introduce a number of technological innovations, including a trusted execution environment (TEE) for block construction, and a community verification network. TEE is expected to shorten block generation time to 200-250 milliseconds. Perhaps affected by this news, UNI broke through $8, and the 24-hour increase once exceeded 12%, the highest level in three months.

Technical details

Low cost while further decentralization

Decentralization is the foundation of DeFi. Ethereum is highly decentralized, which requires compromises in the speed and affordability of L1 transactions. In order to maintain the decentralized way to scale Ethereum, Ethereum began to provide cheap data to L2s earlier this year as part of a rollup-centric roadmap.

Unichain aims to leverage and accelerate Ethereum's scaling roadmap, moving execution to L2. In practice, this means that compared to Ethereum L1, Unichain will reduce transaction costs by about 95% in the short term, and even more in the future.

Unichain will launch a decentralized validation network that allows nodes to validate blocks. This adds an extra layer of finality and reduces the risk of conflicting or invalid blocks. The community validation network will be launched in 2025. It is designed to help achieve decentralization "by allowing full nodes to help validate blocks by staking UNI." To become a validator of the Unichain virtual machine, node operators must stake UNI tokens on the Ethereum mainnet.

Fast, near-instant transactions

To bring the next generation of markets to the chain, DeFi needs to be faster. The current Ethereum mainnet block time is 12 seconds, and most L2 networks are 2 seconds. Unichain's initial block time is 1 second, and in the future, "sub-blocks" will be launched, with plans to reduce block times to less than 250 milliseconds. Instant, faster blocks increase market efficiency and reduce the value of MEV loss.

This improvement was made possible by a block builder developed in partnership with Flashbots that uses a Trusted Execution Environment (TEE). In addition to increased speed, TEEs are designed to increase transparency in transaction ordering and prevent transaction failures.

While TEEs cannot replace decentralized consensus, they can significantly enhance trust and security compared to other block builders.

Seamless Multi-Chain Transactions

As Ethereum’s scaling roadmap is realized, many L2s will emerge. While new L2s help reduce costs, they fragment liquidity and create a poor user experience. Unichain is built to enable seamless access to transactions, no matter which chain the user is on.

As part of the Optimism hyperchain, Unichain is working with OP Labs to enable native interoperability, which will enable single-block cross-chain messaging between hyperchain L2s. Superchain is an interoperable network of L2 scaling solutions built using the Optimism technology stack. Other Superchain networks include Base and SNAXchain, which manages Synthetix's decentralized perpetual exchange. For chains outside of Superchain, Unichain will increase interoperability between all chains through initiatives such as ERC-7683.

When users have a simple, intuitive interface to access cross-chain liquidity, it will have a greater impact. Shortly after the launch of Unichain, cross-chain transactions will be introduced in the Uniswap interface and Uniswap wallet.

Currently, Uniswap has selected Pyth Network to provide real-time data for Unichain. Pyth Network's 500+ real-time price information and low-latency data are updated every 400 milliseconds, ensuring that Unichain developers have real-time access to DeFi data.

Does it make sense for Unichain to catch up late?

Although the launch of Unichain has received some market attention and boosted the performance of the UNI token, a large number of L2 solutions have emerged in the crypto industry over the past year, which market experts believe has led to network fragmentation. However, Hayden Adams, CEO of Uniswap Labs, explained the importance of multiple L2 chains to Ethereum expansion, noting that "the Internet of Value cannot run on a single chain."

But it's not all praise. As early as September 2022, Vitalik said he did not understand the significance of Uniswap as a chain. He believes that the core value of Uniswap is that users can complete transactions quickly, and the Uniswap chain or Rollup does not provide additional advantages in this regard. It makes more sense to replicate the Uniswap model on each Rollup because cross-chain bridging has inherent friction and time delays that cannot be fully abstracted. In addition, wealthy users can use automated tools to split transactions across multiple Rollups to reduce slippage risks.