News has it that the Uniswap token skyrocketed over 38% following a “UNIfication” proposal that introduces a protocol fee switch and a token burn mechanism designed to increase its value.
The rally kicked off Monday the 10th November as the Uniswap Foundation and Uniswap Labs dropped their joint proposal. The proposal pretty much aims to make Uniswap token far more attractive for investors.
What does the plan entail?
At the heart of the plan is activating a protocol-level fee switch to burn Uniswap token supplies directly, alongside a new Protocol Fee Discount Auctions system to boost returns for liquidity providers.
But to be honest the proposed burn of 100 million UNI tokens, about 16% of the circulating supply from the treasury, takes the cake.
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The burn could dramatically tighten supply-demand dynamics for the Uniswap token, the governance powerhouse behind the world’s leading decentralized exchange.
Fees from Uniswap’s Ethereum Layer 2 network Unichain, which has already raked in $7.5 million in annualized fees just nine months post-launch, will funnel straight into the same Uniswap token burn mechanism.
“We believe this proposal positions the Uniswap Protocol to win as the default decentralized exchange for tokenized value,” the Foundation said.
Uniswap Token Hits $9.70, Market Cap Surpasses $6 Billion
After the news broke, Uniswap token didn’t just rise. It pretty much exploded 38.5% to $9.70, injecting fresh life into the governance token that had lagged behind Bitcoin, BNB and Solana.
UNI’s market cap blasted past $6 billion, becoming the 34th largest cryptocurrency.
Uniswap remains the king of the DEX space, especially having processed a staggering $4 trillion in cumulative volume since 2018.
Grants, Budgets, and the Next Era
Dubbed the protocol’s “next era,” the Foundation vows to prioritize grants for protocol upgrades, growth initiatives, and supporting DeFi builders.
A new Growth Budget will distribute 20 million UNI tokens quarterly to fuel ecosystem expansion and empower industry innovators.
Crypto space is an interesting one. What becomes of the Uniswap token remains to be seen.
