Uniswap Latest News: UNIfication Plans For Fee, Burns, Governance

Uniswap Latest News: .05% Fee, 100M UNI Burn Plan, 20M UNI Growth Fund

Uniswap Latest News where Foundation & Labs have released the UNIfication proposal for enhancing the growth of the protocol, implementing UNI burns, and restructuring the ecosystem as a means of recommitting to both the decentralization of the exchange and token scarcity. 

UNIfication of Foundation and Labs

The Foundation and Uniswap Labs have jointly released a governance proposal named UNIfication. The proposal seeks to align incentives across the Uniswap ecosystem, streamline operations, and channel focus and effort into the development and growth of the protocol. 

The proposal moves the vast majority of Foundation staff and initiatives to Labs. Only a small core team will stay on in the Foundation to work on fulfilling the remainder of the $100m in grants, at which point the Foundation will sunset. The reorganization is paired with an aim to unify the teams working toward long-term success.

Source: Wu Blockchain X

Uniswap Protocol Fees and UNI Burn

A major part of the proposal is the activation of protocol fees. Currently, liquidity providers (LPs) receive 0.3% fees. Under UNification:

• LPs receive 0.25%

• The remaining 0.05% will be used to buy back and burn UNI tokens

• This mechanism is expected to generate ~$38 million in UNI burns per month, based on Uniswap’s annualized swap volume of ~$2.8 billion.

• Additionally, Unichain sequencer fees (~$7.5 million annually) will also contribute to UNI burns, enhancing token scarcity. 

• The proposal also includes a one-time burn of 100m tokens retroactively for collecting fees that otherwise would have been collected since launch.

According to data shared by Wu Shuo, citing analyst jpn memelord, enabling Uniswap’s fee switch could also eliminate fraudulent liquidity pools such as honeypots and automated rug pulls. These scams thrive in a zero-fee environment, but once protocol fees are introduced, they are likely to disappear overnight. 

Source: X

On Uniswap’s Base network, roughly half of the $208.07 billion transaction volume in 2025 could be linked to such pools, while legitimate volume stands near $77.38 billion—showing how the new fee model could make trading safer and more transparent.

Uniswap founder Hayden Adams said the Fee Switch Activation Proposal will take about 22 days to complete. It includes 7 days for public comments, 5 days for snapshot voting, and 10 days for on-chain voting and execution. He added that the final activation might be slightly delayed, but it’s a key step toward bringing the new fee system live.

Growth Budget and Ecosystem Support

One major component of the Unification proposal is the introduction of what will now be known as the Growth Budget, proposing 20m UNI to be used yearly for the development of both protocol and ecosystem. 

This budget will be allocated quarterly based on a Service Provider Agreement, ensuring services under Labs' activities and disbursements are accounted for and in alignment with the governance framework implemented, specifically (DUNI). 

Labs will assume responsibility for the disbursements related to grants funded by the ecosystem, developer programs, strategic partnerships & collaborations, which will allow continuous growth of the ecosystem and adoption of new features.

New Mechanisms and Features

The proposal lays out several important innovations: 

• Protocol Fee Discount Auctions (PFDA):  The system enables MEV capture to benefit LPs while generating further UNI burns.

• Aggregator Hooks:  With Uniswap v4, it becomes an on-chain aggregator, acquiring liquidity from other protocols while burning more UNI.

• Unisocks LP Burn:  In addition, the original Unisocks liquidity from Uniswap v1 will be transferred to v4 and burned forever, ensuring that supply is locked for good.

These mechanisms are designed not just to try to secure liquidity and developer uptake and usage of the protocol, but are designed to drive a deflationary effect on UNI.

Financial Impact and Comparison

With our plan of a 0.05% protocol fee plus Unichain sequencer fees, we project UNI burns of ~$38 million a month. That would surpass Pump.fun ($35 million) but trail Hyperliquid ($95 million). This would create a competitive position relative to other DeFi projects utilizing deflationary mechanisms.

Conclusion

The UNIfication proposal represents a new frontier for Uniswap. We are merging token scarcity with ecosystem fundings and aligning governance while at the same time enhancing the Protocol and enabling the DeFi community across the globe.