The BSC project clones Uniswap V3 despite the license
Key points to remember
- A Uniswap V3 fork called HolaSwap has been launched on Binance Smart Chain.
- As the Uniswap V3 source code is copyrighted, there could be legal ramifications if the anonymous developers are found.
- Unlike Uniswap, HolaSwap has yet to launch a governance token.
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Anonymous Developers Fork Uniswap V3 on Binance Smart Chain, defying the commercial source license which restricts all use of the source code for two years.
HolaSwap breaks the copyright of Uniswap V3
HolaSwap used Uniswap V3 source code despite a commercial source license that protects the use of the code for the next two years. The project was started on Binance Smart Chain, a blockchain owned by Binance that replicates certain aspects of Ethereum. The code can be viewed on BscScan.
This is not the first time that another project has cloned the code for Uniswap. An last year’s DeFi summer peak, pseudonymous developer Chef Nomi created Uniswap V1 to launch SushiSwap. The project introduced the SUSHI governance token and prompted Uniswap liquidity providers to place their tokens on the protocol. Uniswap users who contributed cash to SushiSwap won generous SUSHI rewards. This decision allowed SushiSwap to siphon off a large portion of Uniswap’s cash.
Shortly after the “vampire attack”, Uniswap launched its own UNI token. The two projects have since been the main DEXs in the Ethereum ecosystem.
The Uniswap team seemed to want to prevent another project from copying the code it had used after the launch of SushiSwap. Uniswap V3 was unveiled in March and introduced a commercial-source license that implements a commercial use period for code of up to two years. Announcing the V3 update, Uniswap wrote:
“We strongly believe that decentralized financial infrastructure should ultimately be free and open source software. At the same time, we believe that the Uniswap community should be the first to build an ecosystem around the Uniswap v3 Core codebase.
The license protects the rights of the original developers by protecting the software in copyright and by issuing a license that gives legal permission to copy, distribute or modify the code.
The HolaSwap developers have eliminated a governance token, possibly to bypass commercial use of the product. However, the license only allows “non-productive use of the code”.
Uniswap and other Ethereum DEXs are unlikely to be affected by the Binance Smart Chain project. It’s one of the few exchanges that doesn’t include a governance token for yield farmers. But it is not unlikely that Uniswap V3 could be cloned again in the future.
Uniswap V3 is designed to help liquidity providers by improving capital efficiency up to 4,000 times. He plans to launch the Optimistic Rollup Arbitrum and Optimism solutions, which will likely reduce transaction costs and potentially displace liquidity from Binance Smart Chain projects like PancakeSwap and HolaSwap.
Binance Smart Chain may also suffer from user migration to Ethereum and other chains due to the various attacks affecting projects on the network. BurgerSwap, Uranium Finance, Meerkat Finance, and Bunny Finance have all suffered attacks in recent weeks, resulting in millions of dollars in losses for users.
It is currently unclear how Uniswap plans to respond to the launch of HolaSwap. Crypto Briefing has contacted the team for comment.
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