2021-05-11 20:55:55

Uniswap vs. SushiSwap • Investment Comparison • Benzinga

Uniswap and SushiSwap are competing decentralized exchanges (DEXs) built on the Ethereum blockchain. While Uniswap handles more volume and has been around for more time, SushiSwap does have some unique benefits such as a yield farming platform and bonuses for token holders. 

But which is the premier DeFi platform? Learn more about both Uniswap and SushiSwap to see which DEX is right for you. 

What is Uniswap?

Uniswap is a decentralized exchange where anyone in the world can deposit money into liquidity pools or use them to swap between currencies for a small fee. Each pool represents a token pair between 2 Ethereum-based currencies. Just like a USD/CAD exchange you’d use before crossing the Ambassador Bridge, Uniswap provides UNI/ETH, ETH/USDC and many many more. 

Those who deposit money earn this fee. They are known as liquidity providers (LPs), and they are incentivized to provide liquidity in order to earn the fee associated with all the swaps they provide the liquidity for. 

LPs can choose which crypto pair they want to provide liquidity for, and in the newly-released Uniswap V3, LPs can even choose which section of the price curve they wish to provide liquidity for. This means they can concentrate their liquidity around the relevant range, where the vast majority of swaps are happening. They also earn much higher yields by concentrating their liquidity, but expose themselves to price action that might take them out of the fee-earning range. 

Uniswap liquidity pools are Ethereum smart contracts at their core. These smart contracts automate market making, and all of the swap features are also handled automatically by code. 

What is SushiSwap

SushiSwap is a fork, or copy, of Uniswap with some minor changes. SushiSwap’s user interface is based on a sushi menu, and more gamified than Uniswap’s platform. 

SushiSwap was launched by it’s anonymous “chef” Nomi back in August 2020, and drama with Uniswap’s creator Hayden Adams quickly ensued. Hayden was not happy about a copycat stealing nearly a billion dollars in staked liquidity within just a few hours of launching, and rightfully so. 

But, why did so many LPs move their money off of the time-tested Uniswap? In short, Uniswap had already completed some token distribution benefits that SushiSwap was still providing, making it temporarily more lucrative for LPs to provide liquidity to SushiSwap pools. 

Similarities Between Uniswap and SushiSwap

SushiSwap began as a fork of Uniswap, a literal copy-paste. While some changes have been made, the core products remain the same. 

Both Uniswap and SushiSwap are automated market makers (AMMs) that operate decentrally on the Ethereum blockchain. Both platforms can be used to swap between currencies by tapping into liquidity pools filled by other users who are active in the DeFi ecosystem. 

You can also become a liquidity provider on both platforms and earn the fees associated with the swaps you provide liquidity for. All of this executes automatically by the smart contract making you an effectively passive source of income. 

Differences Between Uniswap and SushiSwap

There are a few key differences that separate the Unicorn from the Sushi copycat.

  1. Uniswap has launched V3 which enables concentrated liquidity positions, represented by NFTs and stored in Ethereum wallets just like ETH, UNI and any other NFT. Concentrated liquidity is a huge deal, and has not been achieved by any legacy financial institution before making Uniswap and DeFi some of the most novel operations in the financial arena to date. In SushiSwap as well as Uniswap V2, liquidity can only be provided across the entire price curve, which means a huge portion of your position is not in fee-earning territory, and making an equivalent yield to the v3 version would require an enormous amount of V2 liquidity.
  2. Uniswap offers multiple fee tiers, which are all paid fully to the LP. In contrast, SushiSwap offers a 0.3% fee for swaps, 0.25% of which is given to the LP, and the remaining 0.05% is distributed to SUSHI token holders. As a token holder, you will earn more in SUSHI, whereas a liquidity provider is better off in a Uniswap pool making the full 0.3%. 
  3. SushiSwap offers a yield farming platform. Let’s say you stake ETH into a smart contract for the Ethereum 2.0 upgrade. Then you’ll receive an ETH2.0 token that can later be redeemed for your original ETH. This way you hold a “wrapped” token that represents your “real” token. Some wrapped tokens can be staked as well, compounding the yield. This process is known as “yield farming”. Some SushiSwap yield farming pools boast APYs up to 96%. Just note this is an increasingly risky strategy that should be approached with extreme caution. 

Where to Buy Uniswap

Uniswap is available on Kraken, Gemini and Coinbase (as well as Binance and a few others available to non-U.S. customers). If you’re U.S.-based and don’t have an account with one of these centralized exchanges, there are links provided below for you to get started today. 

Just note that due to the U.S. Securities and Exchange Commission (SEC) Know Your Customer (KYC) regulations, you’ll have to verify your identity for tax purposes. This will include uploading your Social Security number, photo ID, full name and date of birth. 

Best For

Crypto futures traders

Best For

Crypto futures traders

1 Minute Review

Kraken is a cryptocurrency that offers access to more than 50 supported coins and tokens, staking capabilities, futures trading and more. Kraken offers a variable maker-taker fee schedule, which often results in lower fees compared to flat-rate brokerages.

In addition to a wide range of crypto choices, Kraken offers customizable ordering platforms and mobile apps that you can use to fully refine your trading experience. There’s plenty to love about trading on Kraken. It appeals to both seasoned professionals and new investors looking to learn more about the market.

Best For
  • Cryptocurrency investors looking for a wide selection of supported assets
  • Crypto futures traders
  • Beginner investors looking for maximum account security
Pros
  • Wide selection of supported tradable assets
  • Straightforward platform is easy for new users to master
  • 24/7 customer service available via live chat
Cons
  • Maker-taker fee schedule may confuse some users
  • No option for phone or email customer service

1 Minute Review

Gemini is a cryptocurrency exchange and custodian that offers investors access to 26 coins and tokens. Founded in the US, Gemini is expanding globally, in particular into Europe and Asia. Offerings include both major cryptocurrency projects like Bitcoin and Ethereum, and smaller altcoins like Orchid and 0x.

Gemini is 1 of the only brokers with multiple platform options based on skill level. New investors will love the streamlined interface of Gemini’s mobile and web apps, while advanced investors might appreciate all the tools that come with ActiveTrader. 

In addition to a host of platform choices, Gemini users also have access to insured hot wallets to store tokens without worrying about digital asset theft. Learn more about what Gemini can do for you in our review.

Best For
  • New investors looking for a simple mobile and web app
  • Experienced investors who need a more advanced platform with more tools
  • Users looking for a 1-stop-shop to buy, sell and store all of their coins
Pros
  • Easy and quick signups — can get started in as little as a few minutes
  • Multitude of platforms to accommodate traders of all skill levels
  • Hot wallets include insurance to protect your from theft and hacking attempts
Cons
  • Charges both a commission and a convenience fee for users buying and selling through the desktop or mobile app

1 Minute Review

Crypto.com strives to make cryptocurrency a part of everyday life by offering a full suite of services for crypto users. The company offers a Crypto.com App, Exchange, Visa Card, DeFi swap, DeFi Wallet, DeFi Earn, Crypto.com Price, staking, crypto lending, and many other services. What really sets them apart, however, is the combination of super low fees and incredibly generous rewards programs for their users.

Best For
  • Traders who want access to a secure, low-cost cryptocurrency exchange
  • Passive investors who want to earn interest on their balance without frequent trading
  • Mobile investors who prefer to handle all their crypto needs via their phone or tablet
Pros
  • Low fees
  • High security
  • One-stop shop for all your crypto needs (wallet, trading, spending, and more)
  • Lots of ways to earn interest, rewards, and rebates
Cons
  • Low privacy
  • Customer service response time could be improved

Best For

Crypto Investing

Best For

Crypto Investing

1 Minute Review

Coinbase is one of the Internet’s largest cryptocurrency trading platforms. From Bitcoin to Litecoin or Basic Attention Token to Chainlink, Coinbase makes it exceptionally simple to buy and sell major cryptocurrency pairs. 

You can even earn cryptocurrency rewards through Coinbase’s unique Coinbase Earn feature. More advanced traders will love the Coinbase Pro platform, which offers more order types and enhanced functionality.

Though Coinbase doesn’t offer the most affordable pricing or the lowest fees, its simple platform is easy enough for complete beginners to master in as little as a single trade.

Best For
  • New cryptocurrency traders
  • Cryptocurrency traders interested in major pairs
  • Cryptocurrency traders interested in a simple platform
Pros
  • Simple platform is easy to operate
  • Comprehensive mobile app mirrors desktop functionality
  • Coinbase Earn feature rewards you with crypto for learning about available coins
Cons
  • Higher fees than competitors

Where to Buy SushiSwap

SushiSwap is available for direct purchase on Coinbase globally, and Binance if you’re outside the U.S. 

Alternatively, you can purchase ETH on a wider variety of exchanges, and use Uniswap or SushiSwap to swap into Sushi tokens. 

Best For

Crypto futures traders

Best For

Crypto futures traders

1 Minute Review

Kraken is a cryptocurrency that offers access to more than 50 supported coins and tokens, staking capabilities, futures trading and more. Kraken offers a variable maker-taker fee schedule, which often results in lower fees compared to flat-rate brokerages.

In addition to a wide range of crypto choices, Kraken offers customizable ordering platforms and mobile apps that you can use to fully refine your trading experience. There’s plenty to love about trading on Kraken. It appeals to both seasoned professionals and new investors looking to learn more about the market.

Best For
  • Cryptocurrency investors looking for a wide selection of supported assets
  • Crypto futures traders
  • Beginner investors looking for maximum account security
Pros
  • Wide selection of supported tradable assets
  • Straightforward platform is easy for new users to master
  • 24/7 customer service available via live chat
Cons
  • Maker-taker fee schedule may confuse some users
  • No option for phone or email customer service

1 Minute Review

Gemini is a cryptocurrency exchange and custodian that offers investors access to 26 coins and tokens. Founded in the US, Gemini is expanding globally, in particular into Europe and Asia. Offerings include both major cryptocurrency projects like Bitcoin and Ethereum, and smaller altcoins like Orchid and 0x.

Gemini is 1 of the only brokers with multiple platform options based on skill level. New investors will love the streamlined interface of Gemini’s mobile and web apps, while advanced investors might appreciate all the tools that come with ActiveTrader. 

In addition to a host of platform choices, Gemini users also have access to insured hot wallets to store tokens without worrying about digital asset theft. Learn more about what Gemini can do for you in our review.

Best For
  • New investors looking for a simple mobile and web app
  • Experienced investors who need a more advanced platform with more tools
  • Users looking for a 1-stop-shop to buy, sell and store all of their coins
Pros
  • Easy and quick signups — can get started in as little as a few minutes
  • Multitude of platforms to accommodate traders of all skill levels
  • Hot wallets include insurance to protect your from theft and hacking attempts
Cons
  • Charges both a commission and a convenience fee for users buying and selling through the desktop or mobile app

1 Minute Review

Crypto.com strives to make cryptocurrency a part of everyday life by offering a full suite of services for crypto users. The company offers a Crypto.com App, Exchange, Visa Card, DeFi swap, DeFi Wallet, DeFi Earn, Crypto.com Price, staking, crypto lending, and many other services. What really sets them apart, however, is the combination of super low fees and incredibly generous rewards programs for their users.

Best For
  • Traders who want access to a secure, low-cost cryptocurrency exchange
  • Passive investors who want to earn interest on their balance without frequent trading
  • Mobile investors who prefer to handle all their crypto needs via their phone or tablet
Pros
  • Low fees
  • High security
  • One-stop shop for all your crypto needs (wallet, trading, spending, and more)
  • Lots of ways to earn interest, rewards, and rebates
Cons
  • Low privacy
  • Customer service response time could be improved

Best For

Crypto Investing

Best For

Crypto Investing

1 Minute Review

Coinbase is one of the Internet’s largest cryptocurrency trading platforms. From Bitcoin to Litecoin or Basic Attention Token to Chainlink, Coinbase makes it exceptionally simple to buy and sell major cryptocurrency pairs. 

You can even earn cryptocurrency rewards through Coinbase’s unique Coinbase Earn feature. More advanced traders will love the Coinbase Pro platform, which offers more order types and enhanced functionality.

Though Coinbase doesn’t offer the most affordable pricing or the lowest fees, its simple platform is easy enough for complete beginners to master in as little as a single trade.

Best For
  • New cryptocurrency traders
  • Cryptocurrency traders interested in major pairs
  • Cryptocurrency traders interested in a simple platform
Pros
  • Simple platform is easy to operate
  • Comprehensive mobile app mirrors desktop functionality
  • Coinbase Earn feature rewards you with crypto for learning about available coins
Cons
  • Higher fees than competitors

FAQ

Does Uniswap or SushiSwap have better returns?

1

Does Uniswap or SushiSwap have better returns?

asked

Logan Ross, President, Wolverine Blockchain

1

Uniswap gives liquidity providers the option to charge 0.05%, 0.3% or 1% depending on the trading pair. The more exotic the pairs typically lean towards the 1% fee tier.

answered

Benzinga

Is SushiSwap better than Uniswap?

1

Is SushiSwap better than Uniswap?

asked

Logan Ross, President, Wolverine Blockchain

1

Not really. Uniswap pays their liquidity providers more and has a better interface. Sushiswap is better for yield farming, although that may not last forever.

answered

Benzinga

Gemini builds crypto products to help you buy, sell, and store your bitcoin and cryptocurrency. You can buy bitcoin and crypto instantly and access all the tools you need to understand the crypto market and start investing, all through one clear, attractive interface. Gemini Crypto Platform offers excellent account management options. You can manage your account at a glance, view your account balance 24-hour changes and percent changes. Get started with Gemini now.

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