Uniswap is a pioneering Dex protocol built on the Ethereum blockchain, designed to facilitate automated trading of decentralised tokens. It operates on a model of liquidity pools, allowing users to trade without a traditional centralised market maker. Instead, anyone can pool their tokens into collective funds that others can trade against, earning passive income from trading fees based on the amount of liquidity they provide. Uniswap stands out due to its unique use of an automated market-making (AMM) system, where the algorithm sets prices according to a pre-determined formula, rather than using an order book. This innovation not only promotes infinite liquidity within the limits of the pooled funds but also ensures more stable and predictable pricing mechanisms compared to traditional exchanges.