Hayden Adams: The Story of Uniswap

A cryptocurrency visionary changing the way the world trades digital assets.

Written by: Thejaswini M A

Translated by: Block unicorn

Preface

July 6, 2017. A call from the HR department.

After working as a mechanical engineer at Siemens for a year, Hayden Adams was laid off. He always felt he wasn’t quite suited for thermal flow simulation work. Adams didn’t perform well in this position. The company was downsizing.

But at 24, Adams only felt relieved.

He had always been torn about whether engineering was the right career path. The layoff forced him to make a decision he had been avoiding.

One day, his phone buzzed. A text from his college roommate.

Karl Floersch was working at the Ethereum Foundation. For years, he had been evangelizing blockchain technology. Smart contracts. Decentralized applications. All revolutionary stuff.

Adams always turned a deaf ear. He thought it was too abstract, too weird.

Now, unemployed and lost, he decided to listen.

The call lasted three hours. Floersch painted a picture of the future. Code without human oversight. Money flows without banks. Applications serving millions without corporate control.

This conversation planted the seed for the birth of Uniswap.

But first, he needed to convince himself that switching from mechanical engineering to crypto was a reasonable choice.

Evangelist of Ethereum

Adams saw uncertainty, while Floersch saw opportunity.

Ethereum was still young at the time, young enough that a motivated person could become an expert within months. The barrier to entry was low because few people understood the technology.

Adams had concerns. He had no programming background beyond basic courses. He had never built a website or written a smart contract. The prospect of switching from mechanical engineering to software development was daunting.

Floersch offered a framework: learn by building real projects. Adams shouldn’t just take online courses, but should pick a concrete project and work to complete it. Learning would happen naturally in the process of creating.

Floersch explained how Ethereum worked, the importance of decentralized applications, and the problems that needed solving. He described an emerging ecosystem where small teams could build applications serving millions without traditional corporate infrastructure.

Despite his doubts, Adams found himself becoming interested.

He made a decision. He would spend the next year learning to program and building something meaningful on Ethereum. By the end of the call, Adams was cautiously optimistic.

Underground Laboratory

Adams moved back to his childhood bedroom in the suburbs of New York.

His parents did their best to support him. Their son had studied mechanical engineering at Stony Brook University. He worked at a well-known company. But now he wanted to learn programming and build applications on something called blockchain.

The learning curve was steep. Adams watched JavaScript tutorials on YouTube. He read the documentation for Solidity, Ethereum’s programming language. Concepts intuitive to computer science graduates required deep study for someone from a physical engineering background. He approached programming as he would any engineering problem. Every function had its use in a larger system. Every variable had meaning. Smart contracts were machines that transformed inputs into outputs according to predetermined rules.

Progress was slow. Adams built simple contracts to store and retrieve data. He learned to deploy code to Ethereum’s test network. Each small success narrowed the gap between abstract concepts and practical implementation.

Floersch visited regularly, offering guidance and encouragement. During a visit at the end of 2017, he presented Adams with a specific challenge.

Ethereum co-founder Vitalik Buterin had written a blog post about automated market makers. The concept described a way to trade without traditional order books. Traders would no longer match buy and sell orders, but interact with liquidity pools managed by mathematical formulas.

No one had yet built a usable implementation.

Adams studied the concept. Market making involved complex systems with multiple participants, precise calculations, and real-time responses. The problem combined mathematical theory and practical engineering, which piqued his interest.

Floersch made a proposal. Build a working prototype with a user interface within a month, and he would showcase it at the upcoming Ethereum flagship conference, Devcon.

Adams accepted the challenge. He had thirty days to learn web development, implement the automated market maker logic, and create something worthy of presenting to the global Ethereum community.

The Protocol That Changed Everything

November 2, 2018. Adams was ready to deploy his smart contract to the Ethereum mainnet.

It took over a year to go from prototype to production. The initial one-month challenge proposed by Floersch had evolved into a comprehensive protocol through multiple iterations. The first demo at Devcon 2 proved the concept was feasible. But Adams wanted to build a robust system for real users with real money. The process included rewriting smart contracts, conducting security audits, and optimizing the user interface. Each improvement brought the system closer to production readiness.

Vitalik Buterin suggested rewriting the contract in Vyper and recommended applying for funding from the Ethereum Foundation. The grant application process forced Adams to clearly articulate his vision.

A $65,000 grant provided the funds for him to work on the project full-time. Adams used the money to audit the smart contracts, build a production-ready interface, and prepare for mainnet launch. Every detail mattered, as users would be trusting the system with real money.

The core mathematical formula of Uniswap is x * y = k.

This constant product formula ensures that the product of the two tokens in the liquidity pool remains unchanged during trades. As one token becomes scarce, its price rises proportionally.

Adams deployed the contract during Devcon 4 in Prague. Launching at Ethereum’s largest conference maximized attention from developers and early adopters. He announced the deployment to about 200 followers on Twitter.

Early reactions were mixed. Some developers praised its elegant design and permissionless architecture. Others questioned whether automated market makers could compete with traditional centralized exchanges. In the first few weeks, trading volume was limited to curious developers and DeFi enthusiasts.

Adams anticipated this skepticism. Uniswap was not designed to be more efficient than centralized exchanges, but to offer trustless trading without intermediaries, permissionless token listings, and composable liquidity for other applications to build upon. Centralized exchanges rely on market makers to actively participate and adjust liquidity during price swings. Automated market makers (AMMs) invert this model, automating the market-making function. This means no more need for market makers. Once a liquidity pool is deployed, the pool logic handles market making.

Tokens can be created without anyone’s permission. Therefore, as new tokens are launched on Ethereum, there should be a permissionless way to trade them. Centralized exchanges charge high listing fees and require lengthy approval processes. Uniswap allows anyone to create a market by depositing tokens and earn fees from subsequent trades.

By early 2019, daily trading volume was steadily growing. The protocol processed millions of dollars in trades, with no employees, no office, and no traditional business operations. Adams built a system that operated by mathematical rules rather than human decisions.

The summer of 2020 marked a turning point for DeFi (Decentralized Finance).

DeFi Summer brought explosive growth to blockchain-based financial applications. Uniswap was at the center of this movement, providing the infrastructure for new programmable currencies.

Adams witnessed trading volume surge from tens of millions to billions of dollars per month. The protocol processed more volume than many traditional financial institutions, while remaining decentralized and permissionless.

Success attracted the attention of venture capital. Adams founded Uniswap Labs to formally build a team and accept institutional investment. The company raised $11 million in a Series A round led by Andreessen Horowitz, providing resources to accelerate development.

The second version, launched in May 2020, brought major improvements. The new contracts supported direct trading between any ERC-20 tokens, not just those paired with Ethereum. They included price oracles for use by other protocols in various applications. Flash loans allowed users to temporarily borrow tokens within a single transaction.

These innovations led to use cases Adams had never anticipated. Other developers built lending protocols, derivatives platforms, and yield farming strategies on Uniswap’s infrastructure. The protocol became a composable foundation amplifying innovation across the entire DeFi ecosystem.

The launch of the UNI governance token in September 2020 marked another milestone. Adams and his team distributed 400 tokens to every address that had used Uniswap, creating one of the largest airdrops in crypto history. This retroactive distribution rewarded early users and aligned their interests with the protocol’s long-term success.

The third version, launched in May 2021, introduced concentrated liquidity. Liquidity providers could concentrate their capital within specific price ranges, increasing capital efficiency for certain strategies by up to 4,000 times. This innovation attracted professional market makers while maintaining accessibility for individual users.

The concentrated liquidity feature fundamentally changed how market makers operated on Uniswap. Previously, liquidity was distributed across all possible price ranges, leading to low capital efficiency. V3 allowed providers to define precise liquidity positions within their desired trading ranges. This made positioning more strategic and risk management more robust. Liquidity providers could set stop-loss mechanisms to address impermanent loss by concentrating positions within expected trading ranges, making the market more complex and professionalized.

Uniswap V3 attracted professional market makers seeking advanced strategies and individual users benefiting from greater accessibility and capital efficiency.

Each iteration expanded Uniswap’s capabilities while preserving its core principles. The protocol remained permissionless, trustless, and censorship-resistant. Anyone could trade any token without providing personal information or seeking approval from intermediaries.

Adams built something traditional finance deemed impossible: a fully automated exchange processing tens of billions of dollars in daily volume without human oversight.

On October 10, 2024, Uniswap Labs announced the launch of Unichain, an Ethereum Layer 2 network designed specifically for DeFi applications.

This blockchain marked Adams’ evolution from protocol developer to infrastructure provider. Building a dedicated network enabled Uniswap to optimize the entire tech stack for automated market making.

Unichain launched on February 11, 2025, utilizing Rollup-Boost technology. Trusted execution environments enabled private mempools and fair transaction ordering. This technological innovation solved a long-standing problem in decentralized trading: Maximum Extractable Value (MEV).

In traditional blockchain networks, savvy traders can observe pending transactions and front-run ordinary users by paying higher gas fees. This practice extracts value from ordinary traders, making their transactions more expensive. Unichain’s private mempool hides transaction details before processing, while the trusted execution environment ensures transactions are ordered fairly by arrival time, not by how much users pay.

The network processes transactions in 200-millisecond sub-blocks. The speed boost allows Uniswap to compete with centralized exchanges for latency-sensitive trading strategies. These technological advances reduce the value extracted by savvy traders from ordinary users, creating a fairer trading environment.

Today, Uniswap processes over $2-3 billion in daily trading volume across multiple blockchain networks. The fourth version, launching in 2025, introduces hooks, allowing developers to customize pool behavior for specific use cases. The protocol continues to evolve while maintaining simplicity and accessibility.

Adams has always remained focused on his original mission: to make value exchange as simple and accessible as information exchange.

From his childhood bedroom to billions of dollars in daily trading volume, Uniswap has proven that decentralized systems can compete with traditional institutions.

This is the story of Uniswap. See you in our next article.