Uniswap UNIfication Fee Switch Fuels 50% UNI Rally 100M Burn
Uniswap’s UNIfication governance proposal activates the long-debated fee switch on v2 and v3 pools.
The Uniswap fee switch will divert 16–25% of swap fees into a “Token Jar” smart contract. UNI holders can burn tokens to withdraw crypto from the jar.
The plan also mandates an immediate burn of nearly 100 million UNI—around $800 million—to account for fees since launch. Following the UNIfication announcement, the UNI token rallied over 50% to an intraday peak of $9.94, with trading volume surpassing $3 billion.
Analysts estimate the fee switch could destroy up to $500 million worth of UNI annually, with monthly buybacks of about $38 million. Uniswap Labs and the Uniswap Foundation back the upgrade to reduce circulating supply, share protocol revenue, and reinforce Uniswap’s leading exchange status.
The deflationary tokenomics model and revenue-sharing mechanism align incentives across stakeholders and may drive further UNI token price appreciation.
Bullish
The UNIfication proposal and fee switch activation have already triggered a significant UNI price rally. In the short term, immediate UNI burns and revenue-sharing buybacks are likely to boost demand and tighten supply, driving further price gains. Over the long term, the deflationary tokenomics mechanism and aligned incentives strengthen Uniswap’s governance model and protocol value proposition, potentially fostering sustained UNI appreciation as the protocol matures.