Popular decentralized exchange (DEX), Uniswap, launched its fourth version this week, which brings with it a series of new features and customizability. It also brought, however, the wrath of the open source Ethereum community.
The reason? The license they are using for v4.
Lefteris Karapetsas spoke to Decrypt about the controversy. He is an Ethereum developer, and founder of rotki, a portfolio tracker that protects userâs privacy.
âUniswap decided to go with a Business Source License (BSL), continuing what they did with v3â he said, adding that heâs not happy with the decision. Karapetsas added âthe reason is they donât understand open source and they believe their moat is their code which is wrong.â
Released as a Business Source License 1.1, this type of license means the code is publicly available and is allowed to be copied, modified or redistributed. It does have a limitation, however. It cannot be used for commercial or production purposes for up to four years, at which point it will convert to a General Purpose License (GPL) in perpetuity.
There are five licenses that typically come up on truly free open source projects: Permissive, the Berkeley Software Distribution (BSD) license, the Massachusetts Institute (MIT) license, the Apache license, and Copyleft.
Inventor of Total Value Locked (TVL), Scott Lewis pointed out that while Uniswap claims they open sourced v4, itâs actually a 4-year proprietary license. âIf anyone else misrepresented the truth like this they would be torn to shreds," he said on Twitter. "Thatâs the power of being powerful.â
Uniswap creator Hayden Adams and the protocol's team jumped on a YouTube livestream to discuss the controversy. Lead engineer Noah Zinsmeister thinks four years isnât a very long time, and that [the BSL license] strikes a âreasonable balance between incentivizing innovation and giving exclusive rights to the protocol, which has precedents in 'normal' settings as well.â
âBusiness source license is a tax on innovation,â tweeted Gabriel Shapiro, general counsel at Delphi Labs, a Web3 research and development platform. He also pointed out that âanyone who's looked at BSL code even once, and then later codes something similar, is at a risk of catching a copyright claim.â
The licenses used in the space are, according to Shapiro, difficult to navigate. âIt would be hard to find a team of devs who are both capable of coding a new AMM from scratch and have never looked at Uniswap v4 codeâ he tweeted.
Uniswapâs latest version introduces a new kind of smart contract called âhooks,â which allow developers to expand upon already existing liquidity pools. Lead smart contract engineer for the project, Sara Reynolds, told Decrypt the level of innovation that âhooksâ brings makes it âkind of limitlessâ in terms of customizability.
Many in the open source community think the marketing language used upon launch is misleading. âYou canât call something open source when itâs not,â said Lefteris. He was the first to âcall bullâ on Uniswap on Twitter after v4 was announced. âPlease use the proper terminology as this is insulting to projects actually building open source software,â he wrote.
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