In the evolving world of decentralized digital asset trading, a promising new application called Unibot enables decentralized trading via the popular Telegram messaging app.
Read on to learn what Unibot is, how it works, and its role in the DeFi space.
What Is Unibot?
Unibot is a Telegram bot that enables you to trade crypto tokens on Uniswap v3 directly from the Telegram messaging app.
It is a Leveraged Liquidity Provision (LLP) platform developed for Uniswap v3 by Diamond Protocol, a DeFi protocol focused on modeling on-chain structured products.
The Telegram trading bot allows users to trade different crypto tokens by letting them supply only one asset while borrowing the volatile (the riskier and more unstable token of the trading pair) from Unibot Pool. This approach enhances liquidity management and gives users trading flexibility.
In the past, liquidity providers were required to supply both assets of the trading pair to ensure liquidity. With Unibot, they no longer need to do so since liquidity coming from Uniswap v3 and the borrowed volatile asset from Unibot suffice for a trade.
How Does Unibot Work?
Trading is largely systematic, but Unibot streamlines the process for quick trades by allowing users to buy and sell tokens directly from their hot wallets on Telegram.
Users can use Unibot to buy, sell and swap Ethereum-based tokens. They are only required to input the contract pairs they wish to trade on the Telegram bot channel and specify the amount of ETH they intend to spend on the swap. Unibot then executes the trade on their behalf in seconds by using token pool contracts.
A token pool contract is a distinct identifier for a specific trading pair on a decentralized exchange, in this case, Uniswap v3.
Below are some unique features of Unibot that help traders trade efficiently.
Integration with Telegram
Telegram provides a user-friendly interface for traders, making it convenient to execute trades and providing access to other Unibot’s features.
Quick Buy and Sell Platform
Unibot makes swift transactions after users input the contract pairs they wish to trade and the amount they would like to spend.
Users can list other wallets from successful traders who they want to copy trade from. Unibot will monitor their activity and mirror their transactions using these predetermined criteria.
Smart Method Sniper using Unibot Scanner
The Unibot token scanner is a robust tool that uses smart method sniping to monitor new ERC-20 tokens deployed on the Ethereum network. It gives real-time data on tokens that have been recently launched. It then places them in a queue for immediate purchase as soon as the contract owners make them accessible for buying. This allows users to immediately access the tokens and stay ahead of potential investment opportunities.
Use of Multiple Wallets
Users have the option to choose from three different wallets when conducting trades. This gives them a chance to strategize effectively when making token purchases.
Profit and Loss Analysis
Unibot allows users to monitor and track the performance of their holdings and manage their profit and loss. Gas fees are also included in the total profit and loss calculation.
The Role of the UNIBOT Token
The Unibot Token plays a major role in Uniswap v3 by offering faster transaction speeds for its users. The token can also render yield farming rewards, governance rights, and reduced gas fees to its holders.
In addition, it has an automatic burn rate of 0.1% to drive up the token’s scarcity in an attempt to positively influence its value over time.
Is Unibot Safe?
As with all DeFi platforms, security is the first thing to consider before engaging. Unibot is a custodial platform and has raised concerns over its data security, particularly in handling private keys on behalf of traders. The platform would be vulnerable to hackers or third-party software if these private keys are exposed.
Moreover, a report by Quantstamp said that there could also be the risk of sandwich attacks. In this scenario, an attacker exploits pending transactions to manipulate market prices in their favor. This involves placing one order before the actual trade and another immediately after it. As the attacker’s transactions are executed before and after the original trade, it becomes financially rewarding to the attacker as they gain profit from the price movement they artificially created.
Lastly, the lack of reentrancy guards poses a risk when trading with Unibot since an attacker can exploit a vulnerable smart contract. They can create an external call that could interact with the vulnerable contract and potentially steal your funds by repeatedly calling a function.
You must conduct thorough due diligence and fully understand the risks before trading with Unibot.