Uniswap (UNI) has sparked a storm across DeFi after founder Hayden Adams unveiled the long-awaited “UNIfication” proposal, a sweeping governance overhaul that introduces protocol fees, a substantial $842 million token burn, and a strategic buyback plan.
The move marks Uniswap’s biggest reform since its 2020 token launch, designed to transform UNI from a passive governance token into a deflationary, yield-generating asset.
Under the proposal, 0.3% of all trading volume will now be split between liquidity providers (0.25%) and a UNI buyback pool (0.05%), creating continuous demand for the token. With over $1 trillion in annualized trading volume, analysts project roughly $38 million in monthly buybacks, about $450 million annually.
BitMEX founder Arthur Hayes reportedly purchased $244,000 worth of UNI, joining institutional buyers positioning for a supply shock.
CryptoQuant CEO Ki Young Ju predicted that if protocol fees remain active, annual burns could exceed $500 million, drastically tightening supply. “Even with unlocks, a UNI supply shock seems inevitable,” Ju noted.
The rally also extended to other DeFi assets, such as AAVE, Synthetix, and Compound, as traders speculated that Uniswap’s model could set a new standard for protocol-owned liquidity and value distribution.
The proposal eliminates interface fees, introduces fee discount auctions to enhance LP returns, and compensates governance delegates, turning Uniswap’s decision-making into a professionalized, revenue-sharing system.
Adams emphasized that the initiative represents more than a technical upgrade, it’s a cultural shift. “Uniswap can be the primary place tokens are traded globally,” he said. “This proposal ends a restrictive chapter and begins the decade of Uniswap.”
With UNI up more than 66% this week and investors anticipating formal governance approval, the DeFi giant appears poised to reclaim its dominance as crypto’s flagship decentralized exchange.
Cover image from ChatGPT, UNIUSD chart from Tradingview
