DeFi applications. What they do, how to interact with them

1. ACCESSING
DECENTRALIZED
FINANCE CONTRACTS
ON ETHEREUM
ETH Retrospective
DeFi
Decentralized exchanges
Accessing decentralized exchanges
1/7/2021

2. 1 TRILLION MARK
ETH Price
…

3. BRIEF HISTORY OF ETH
•07-30 Birth
of Platform
•Birth of ERC-
20
2015
•Experiments
with Smart
Contracts
•DAO Birth
and Debacle
2016
ICO
Cryptokitties
2017
Ethereum
Futures
Uniswap
2018
Non-Fungible
Assets
Tether and
other
stablecoins
2019
•ETH 2.0
•DeFi2020
Hadean Archean Proterozoic

4. FOCUS TODAY: DEFI AND
DECENRALIZED EXCHANGES
Ethereum Network V1
Smart Contracts
Tokens (ERC-20, ERC-721, ERC-998,
…)
DeFi Application
Exchanges Casinos Games DAO
Ethereum Network V2

5. DECENTRALIZED FINANCE (DEFI)
Brokerage Exchange Bank

6. DEFI MOMENTUM

7. DECENTRALIZED
EXCHANGES (DEX)
• Role of DEX
• Leaders
• Interfaces

8. CENTRALIZED EXCHANGE
Check Price
Make offer
Check Price
Take offer
Maker Taker

9. DE-CENTRALIZED EXCHANGE (ON-
CHAIN)

10. “ALMOST” DE-CENTRALIZED
EXCHANGE (OFF-CHAIN)

11. DECENTRALIZED EXCHANGES
Oversee security and transfer of assets
Use blockchain or distributed ledger
Typically use smart contracts
Users do not need to transfer their assets to the exchange
May be more anonymous then centralized exchanges
Could be less expensive as users do not need to pay middleman

12. DEX PROS AND CONS
Benefits
Users can list any token they like
Transparency and open protocols
Users to remain in control of their funds
Trustless, which means that users’ funds
and personal data are safe
Security and privacy are well preserved
Draw backs
Very new kid in the block
Slow
Expensive
Prone to instability, slowness and,
occasionally, scams
The same scalability problems as the
underlying blockchain
Sometimes struggle with liquidity
Inconsistent transaction costs
Inconsistent user interfaces

13. LEADING EXCHANGES

14. NOT ALL DECENTRALIZED
EXCHANGES ARE EQUAL

15. DECENTRALIZED EXCHANGE
INSIDE OUT
Unisawp Example

16. UNISWAP
Most popular decentralized exchange
August 30 surpassed major cryptocurrency exchange Coinbase in
volume after its users traded $426 million worth of cryptocurrencies
in a single day
Decentralized exchange based on user provided
liquidity reserves

17. ERC20 TOKEN SWAP ON UNSWAP

18. UNISWAP EXCHANGE CONTRACT

19. MECHANICS OF SWAP

20. UNISWAP FACTORY CONTRACT IN
DETAILpragma solidity >=0.5.0;
interface IUniswapV2Factory {
event PairCreated(address indexed token0, address indexed token1, address pair, uint);
function getPair(address tokenA, address tokenB) external view returns (address pair);
function allPairs(uint) external view returns (address pair);
function allPairsLength() external view returns (uint);
function feeTo() external view returns (address);
function feeToSetter() external view returns (address);
function createPair(address tokenA, address tokenB) external returns (address pair);
}

21. UNISWAP PAIR CONTRACT (1/3)
interface IUniswapV2Pair {
event Approval(address indexed owner, address indexed spender, uint value);
event Transfer(address indexed from, address indexed to, uint value);
function name() external pure returns (string memory);
function symbol() external pure returns (string memory);
function decimals() external pure returns (uint8);
function totalSupply() external view returns (uint);
function balanceOf(address owner) external view returns (uint);
function allowance(address owner, address spender) external view returns (uint);
function approve(address spender, uint value) external returns (bool);
function transfer(address to, uint value) external returns (bool);
function transferFrom(address from, address to, uint value) external returns (bool);
function DOMAIN_SEPARATOR() external view returns (bytes32);
function PERMIT_TYPEHASH() external pure returns (bytes32);
function nonces(address owner) external view returns (uint);
function permit(address owner, address spender, uint value, uint deadline, uint8 v, bytes32 r, bytes32 s) external;

22. UNISWAP PAIR CONTRACT (2/3)
function MINIMUM_LIQUIDITY() external pure returns (uint);
function factory() external view returns (address);
function token0() external view returns (address);
function token1() external view returns (address);
function getReserves() external view returns (uint112 reserve0, uint112 reserve1,
uint32 blockTimestampLast);
function price0CumulativeLast() external view returns (uint);
function price1CumulativeLast() external view returns (uint);
function kLast() external view returns (uint);
function mint(address to) external returns (uint liquidity);
function burn(address to) external returns (uint amount0, uint amount1);
function swap(uint amount0Out, uint amount1Out, address to, bytes calldata data)
external;
function skim(address to) external;
function sync() external;

23. UNISWAP PAIR CONTRACT (3/3)
event Mint(address indexed sender, uint amount0, uint amount1);
event Burn(address indexed sender, uint amount0, uint amount1, address indexed to);
event Swap(
address indexed sender,
uint amount0In,
uint amount1In,
uint amount0Out,
uint amount1Out,
address indexed to
);

24. UNISWAP ROUTER CONTRACT
interface IUniswapV2Router01 {
function factory() external pure returns (address);
function WETH() external pure returns (address);
function addLiquidity()
function addLiquidityETH()
function removeLiquidity()
function removeLiquidityETH()
function removeLiquidityWithPermit()
function removeLiquidityETHWithPermit()
function swapExactTokensForTokens()
function swapTokensForExactTokens()
function swapExactETHForTokens()
function swapTokensForExactETH()
function swapExactTokensForETH()
function swapETHForExactTokens()
function quote(uint amountA, uint reserveA, uint reserveB)
function getAmountOut(uint amountIn, uint reserveIn, uint reserveOut)
function getAmountIn(uint amountOut, uint reserveIn, uint reserveOut)
function getAmountsOut(uint amountIn, address[] calldata path)
function getAmountsIn(uint amountOut, address[] calldata path)
}

25. CHECK ACTIVITY OF THE ROUTER
CONTRACT

26. CHECK TRANSACTION EXECUTED
BY ROUTER

27. INTERACTING WITH
DECENTRALIZED EXCHANGE

28. ACCESSING UNISWAP DEX
WEB UI
API
SDK/Libraries
Smart Contracts

29. WEB UI (DEMO)

30. WEB UI (DEMO PART 2)

31. API ACCESS (DEMO)

32. JAVASCRIPT ACCESS DEMO

33. CALL FROM A SMART CONTRACT

34. SWAP TOKEN TO ETH
// amountOutMin must be retrieved from an oracle of some kind
address[] memory path = new address[](2);
path[0] = address(DAI);
path[1] = UniswapV2Router02.WETH();
UniswapV2Router02.swapExactTokensForETH(amountIn, amountOutMin, path,
msg.sender, block.timestamp)

35. QUESTIONS?

36. OUR NEXT MEETUP
OR
V2

37. STAY IN TOUCH
Gene Leybzon https://www.linkedin.com/in/leybzon/
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20/
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