UNI, the governance token of Uniswap — the almost widely utilized automated market place maker (AMM) in DeFi — has surged significantly after Uniswap V3 was announcedon March 23. At merely over $35 per token, UNI has gained nearly 23% in the past week

The Uniswap team said:

"Today, we are excited to nowadays an overview of Uniswap v3. We are targeting an L1 Ethereum mainnet launch on May 5, with an L2 deployment on Optimism gear up to follow shortly after."

With a market capitalization of $17 billion, information technology has surpassed some major perennial altcoins such as Litecoin (LTC), putting UNI right under XRP whose market cap is over $25 billion.

UNI/USD 4-60 minutes price nautical chart (Gemini). Source: TradingView.com

Why are UNI and Uniswap seeing strong momentum?

At that place are ii primal reasons behind UNI's massive rally in the past ii months.

First, Coinbase's planned initial public offering (IPO) in the U.S. market has caused the rerating of exchange tokens and AMMs.

Second, the overall increase in the involvement in the DeFi sector has pushed up the valuation of major AMMs, including Uniswap and SushiSwap.

On March 21, the price of UNI reached a new all-time high at $35.2, fueled by the excitement surrounding Uniswap V3.

Analysts at Intotheblock said:

"Uniswap's governance token $UNI reached a new high of $35.2 with a lot of excitement building around the upcoming v3. In just 78 days of 2022, the protocol did $73.1b in traded volume and over $219m in fees. Also, the Full Value Locked reached a new ATH of $five.23b."
Uniswap statistics. Source: intotheblock

Investors and DeFi analysts say that the release of Uniswap V3, which substantially is the third version of Uniswap, will likely cause a DeFi and Uniswap "blast."

The pseudonymous investor known every bit "Johnny" wrote:

"In my opinion one time $UNI v3 comes out and $ETH 2.0 comes out we volition see a larger Uniswap nail than nosotros saw in the summer. The plan is to starting planting your seeds now earlier it happens"

UNI is already a bluechip

UNI has go the go-to crypto asset to gain exposure to the DeFi market for many investors due to its dominance in the AMM market and high valuation.

Investors take long considered UNI equally a bluechip asset, representing the exchange and AMM market within DeFi.

Alongside Chemical compound, Aave and SushiSwap, Uniswap remains as one of the 4 major bluechip DeFi tokens.

Mike Abundo, a DeFi analyst and investor, said:

"Each Ethereum finance vertical seems to have a venture-driven blue chip and a customs-driven blue chip. For lending, that'south $COMP and $AAVE. For exchange, that'southward $UNI and $SUSHI. Wonder if we'll see like dichotomies arise in Ethereum art and gaming verticals."

As long as the interest in DeFi and the total value locked (TVL) of all DeFi protocols continue to increase, the demand for UNI is expected to rise.

According to Dappradar, the TVL of the DeFi market has crossed $41 billion and has remained relatively stable above this level.

Out of the $41 billion, $4.75 billion comes from Uniswap, which ways well over 10% of the entire DeFi marketplace's TVL is in Uniswap.

Particularly as the Coinbase IPO nears, the momentum of UNI would likely accelerate, which would likely as well positively affect SushiSwap, BNB, FTT, and other exchange-related crypto assets.