Uniswap not too long ago executed a 100 million UNI token burn, completely eradicating roughly $596 million value of tokens from circulation.
Abstract
- Uniswap completely burned 100M UNI after a 99.9% governance vote handed UNIfication.
- Protocol charges at the moment are reside whereas interface charges stay zero
- UNI jumped 19% throughout voting and rallied one other 6% following the burn.
The burn adopted overwhelming neighborhood approval of the UNIfication governance proposal, which handed with 99.9% help on December 25.
UNI (UNI) rallied 6% over the previous 24 hours, buying and selling in a spread of $5.89 to $6.35. The token surged 19% when voting commenced on December 19-20 as institutional and neighborhood contributors acknowledged the proposal’s transformative influence on token economics.
Uniswap Labs introduced that interface charges have been set to zero whereas protocol charges activate worth seize mechanisms.
Uniswap governance vote achieves 99.9% approval
The UNIfication proposal obtained 125,342,017 UNI votes in favor versus simply 742 towards, considerably exceeding the 40 million UNI quorum requirement.
The 2-day governance timelock previous the treasury burn demonstrated the protocol’s dedication to clear implementation of structural modifications. Voting started at 3:50 UTC on December 19-20, instantly inflicting worth response.
Uniswap Labs confirmed that “Labs interface charges are set to zero” whereas “100M UNI has been burned from the treasury.” Protocol charges at the moment are energetic for v2 and choose v3 swimming pools on mainnet. Unichain charges will circulate to UNI burns after masking Optimism and Layer 1 information prices.
Future payment sources together with protocol charges on Layer 2s, v4, UniswapX, PFDA, and aggregator hooks shall be proposed by means of separate governance votes over time.
Charge constructions fluctuate throughout protocol variations
Uniswap v2 implements a hardcoded mechanism the place governance toggles charges throughout all swimming pools concurrently.
With charges activated, liquidity supplier charges lower from 0.3% to 0.25%, with the 0.05% differential captured by the protocol for token burns.
Uniswap v3 makes use of granular governance management, allowing particular person payment changes by pool. Protocol charges are set at one-quarter of LP charges for 0.01%-0.05% swimming pools and one-sixth of LP charges for 0.30%-1.00% swimming pools.
The tiered construction creates aligned incentives throughout totally different pool threat profiles. Decrease-fee swimming pools face proportionally smaller protocol extraction, whereas higher-fee swimming pools contribute extra to the burn mechanism.
