Uniswap is a cryptocurrency exchange which is decentralized and run with an open-source software as opposed to a centralized intermediary. The main scope of the project is to facilitate automated transactions between cryptocurrency Tokens on the Ethereum blockchain through the use of smart contracts.
Uniswap uses liquidity pools with a goal to create more efficient markets, while it is not serving as Market Maker. The liquidity and market depth is provided by the users themselves, by adding to the exchange a pair of Tokens (ERC-20) to a smart contract. In return, users who act as liquidity providers are given as a reward a percentage of the trading fees.