• Uniswap’s new upgrade has sparked a new controversy regarding its “open source” description, with developers saying “it is not as advertised.”
• The company released its fourth version on a Business Source License, giving room for critics due to its four-year open-source period.
• Uniswap has responded to critics explaining that four years is not a long time to balance incentivizing innovation and giving out exclusive rights.

This week, Uniswap’s developers noted that the new version of the decentralized exchange (DEX) will offer users limitless possibilities; while that may be true, some promises were not.

Prior to the launch of Uniswap’s V4, the management team made several promises from the increased utility of the exchange to its open-source nature which attracted the attention of developers. The promise of it being open-source has been called a “misrepresentation” by a cross-section of Ethereum’s community.

The V4 was released as a Business Source License (BSL), which means that its code is open to the public and can be copied, reproduced, and redistributed, but there’s a caveat. All these can only be done after four years when it converts to a General Purpose License (GPL).

Lefteris Karapetsas, an Ethereum developer and founder of Rotki, expressed his displeasure stating that “Uniswap decided to go with a Business Source License (BSL), continuing what they did with v3. The reason is they don’t understand open source, and they believe their moat is their code which is wrong.” He was the first to call out Uniswap on Twitter and urged them to use the proper terminology as this “is insulting to actual open-source software.”

Another dev, Scott Lewis, pointed out that Unisawap’s V4 is a four-year proprietary license adding that “If anyone else misrepresented the truth like this, they would be torn to shreds. That’s the power of being powerful.”

Uniswap defend their “false” claims

Hayden Adams the founder of Uniswap alongside his development team addressed the controversy on YouTube. The group noted that the four-year period is not as long time as it appears, and it strikes a healthy balance between “incentivizing innovation and giving exclusive rights to the protocol, which has precedents in ‘normal’ settings as well.”

Gabriel Shapiro describes it as a tax on innovation, explaining further that it would be difficult for young devs to navigate while building from scratch. 

“Anyone who’s looked at BSL code even once, and then later codes something similar, is at a risk of catching a copyright claim,” he added. 

Despite the criticisms meted out against Uniswap, many have hailed the V4 for rolling out a new smart contract termed “hooks” which lets developers expand liquidity pools increasing customizability.