Why does Uniswap V2 use `_safeTransfer` to transfer tokens?

Question

I'm looking into Uniswap V2 code and found that it uses _safeTransfer function to transfer ERC20 tokens in the Pair contract.

    function _safeTransfer(address token, address to, uint value) private {
        (bool success, bytes memory data) = token.call(abi.encodeWithSelector(SELECTOR, to, value));
        require(success && (data.length == 0 || abi.decode(data, (bool))), 'UniswapV2: TRANSFER_FAILED');
    }
...

    function burn(address to) external lock returns (uint amount0, uint amount1) {
        ...
        _safeTransfer(_token0, to, amount0);
        ...
    }

Why doesn't it simply call IERC20(_token).transfer(to, amount0) ?

Answer 1

Because the ERC20 standard kinda sucks, and is unclear about how you should handle non-succeeding token transfers, both reverting and just returning false are technically allowed, so this takes both cases into account

(bool success, bytes memory data) = token.call(abi.encodeWithSelector(SELECTOR, to, value));
        // Case where there is no return data      case where there is return data
        require(success && (data.length == 0 || abi.decode(data, (bool))), 'UniswapV2: TRANSFER_FAILED');

• if success is false, the call to the token contract reverted, and we revert the whole transaction,
• if success is true and there is no return data, the token contract doesnt return anything on transfer and the transfer succeeded,
• if success is true but there is return data, we check if it's a bool (if it's not the contract we called isnt compliant with the ERC20 standard and we revert)
  • if that bool is false the transfer didnt complete and we revert
  • if it's true, the transfer completed normally