In Brief:
- Uniswap had announced a new feature called Auto Router.
- Auto Router will split trade in many routes across the different pool.
- It also improve gas cost by minimizing the number of gas-intensive.
Uniswap introduced a new feature called, Auto router. It uses an advanced smart order routing algorithm to find better prices for traders. Users will get an option in which their asset can split routes across many pools to find a better price for traders.
This update will become useful for many traders as it splits routes that execute trades across multiple pools to optimize the best price. Moreover, it executes more powerful and complex algorithms in large data sets for larger trades.
One more feature which has been added in this Uniswap update is that it will automatically shift to v2 (version 2) if it finds the better trade in the context of gas costs.
Split routes are the term in trading where your price splits the route across multiple pools rather than a single route, where it can target the best price to gain interest. The router will provide up to seven paths to split and take advantage of liquidity depth in different pools.
With the optimization in gas cost, small trades will execute more efficiently by minimizing the number of gas-intensive hops to reach the output token. The feature is live and available for all users in the Uniswap App.
Uniswap had also examined 4,429 on-chain swaps from June 1. In this test, Auto Routers had improved pricing 13.97% of all trades and 36.84% of trades between Top 10 Tokens by TVL.
The addition of multiple fee tiers in Uniswap v3 makes this feature more important than ever.
