Uniswap performed a major token burn after approving a long-awaited fee cap proposal, removing 100 million UNI from the protocol’s treasury, worth approximately $596 million at current prices.
Onchain data shows that the burn transaction was completed around 4:30 UTC on December 28, confirming the first large-scale implementation of a management decision made earlier this week. According to to an EmberCN analyst. The transaction permanently reduced the supply of Uniswap (UNI) tokens, marking one of the largest burns ever conducted on a decentralized finance protocol.
The highly anticipated Uniswap protocol fee change, dubbed “UNIFICATION,” passed on Thursday with 99.9% support. More than 125 million UNI tokens were voted in favor of the proposal, compared to just 742 tokens voting against, highlighting the broad consensus among token holders.
Several cryptocurrency industry heavyweights with significant voting power supported the UNIFICATION proposal, including Jesse Waldren, founder and managing partner at cryptocurrency firm Variant; Kain Warwick, creator of decentralized finance protocols Infinex and Synthetix; and Ian Lapham, who previously worked as an engineer at Uniswap Labs.
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Uniswap Labs confirms 100 million burns
Uniswap Labs confirmed execution in a post on X, stating that “UNIFICATION has officially been executed on the chain.”
As part of the update, frontend fees charged by Uniswap Labs were set to zero, while fees were activated on Uniswap v2 and selected v3 pools on the Ethereum mainnet. The fees generated by Unichain will also go towards burning UNI after covering the costs of Optimism and Layer 1 data.
According to CoinMarketCap data, UNI’s value increased by more than 5% in the last 24 hours after the burn, with both trading volume and market capitalization increasing. The number of tokens in circulation is currently approximately 730 million UNI, out of a total supply of 1 billion.
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The Uniswap Foundation will allocate UNI 20 million for development
When the proposal was presented, the Uniswap Foundation stated that it would continue to fund developers and would not pause grant programs that support protocol development. The foundation said helping developers remains a key priority.
To support this plan, the Uniswap Foundation intends to create a growth budget that will commit 20 million UNI tokens to fund growth and expansion across the Uniswap ecosystem.
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