Uniswap UNI Token permanently removed 100 million UNI tokens following its vote. This is equivalent to approximately $596 million.
Token holders overwhelmingly supported the vote, and it passed easily.
This token burn is the largest single token removal in DeFi to date. It also significantly changes Uniswap’s monetary system.
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Governance Overhaul Tokenomics Shift
This milestone came after the approval of the UNIFication proposal, a governance plan that activates Uniswap’s long-awaited fee switch.
Nearly 99.9% of UNI holders voted yes. 125 million UNI votes were cast for the change, with only a handful opposing it. This demonstrates strong community support.
In the new system, a portion of trading fees from Uniswap v2 and selected v3 pools goes to the protocol and is used in ongoing token burns, not just to liquidity providers.
Interface and frontend fees have been reduced to zero, reflecting the shift away from the traditional fee system and toward a value-accumulating economic model.
UNI Price Positively
Following the token burn, the price of UNI rose by approximately 11%. It rose from $5.88 to $6.52 on Sunday, its highest since late November.
But some gains were erased on Monday, and the price of UNI fell to $6.17, a decline of approximately 5%.
Uniswap is one of the top DeFi trading platforms. It handles approximately $11 billion in trading volume each week and earns around $580 million in fees yearly, according to DeFiLlama.
Why This Matters
Token burns and governance changes show how DeFi platforms like Uniswap can create long-term value by aligning their rules, money systems, and opinions with community opinion.
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People Also Ask – Uniswap UNI Token:
What is a token burn?
A token burn occurs when a cryptocurrency project permanently removes coins from circulation. This reduces supply and can increase value or scarcity.
Why did Uniswap burn 100 million UNI tokens?
Uniswap burned these tokens after a governance vote that activated a “fee switch.” Its purpose was to indirectly distribute a portion of protocol fees to token holders by reducing supply.
What is a governance vote in crypto?
In a governance vote, token holders collectively decide what changes should be made to the protocol, such as new features, fee models, or tokenomics adjustments.
What is a fee switch?
Fee switch means that a portion of the platform’s trading fees is used for purposes such as token burns or protocol treasury, rather than going to liquidity providers.
