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Uniswap Foundation Unveils Major Upgrade Plan, UNI Price Skyrockets 52%

Uniswap (UNI), one of the industry’s largest decentralized cryptocurrency exchanges (DEXs), has set the stage for a major shift in its ecosystem with a proposed upgrade that could have significant implications for UNI token holders. 

The upgrade aims to bolster governance participation, enhance resilience, and reward token holders for active engagement within the Uniswap ecosystem.

Uniswap Takes Big Leap In Governance

Uniswap Foundation (UF) Lead Developer Erin Koen, while expressing his enthusiasm, has suggested that it has been the “biggest week in Uniswap Protocol Governance” and revealed a major upgrade proposal for the system.

At the heart of the proposed upgrade lies a fee mechanism designed to reward UNI token holders who stake and delegate their tokens. As announced, by actively participating in the governance process, token holders can earn additional rewards in the form of protocol fees. 

In addition to the enhanced rewards, the proposed upgrade seeks to fortify Uniswap Governance, making it “more resilient and decentralized.” 

According to Koen, by increasing the number of actively involved token holders, the governance structure becomes more robust, ensuring that decisions align with the collective interests of the UNI community. 

The proposed upgrade maintains governance control over core parameters such as fee-charged pools and fee magnitude. Token holders will collectively decide on these critical aspects, allowing for flexibility and adaptability in response to market dynamics. 

Beyond the immediate benefits, the proposed upgrade holds the potential for long-term value appreciation of the UNI token. By incentivizing participation and aligning token holders’ interests with the ecosystem’s success, Uniswap aims to foster organic growth and adoption. 

Assuming a successful on-chain vote, the community will have the option to activate fees. Gauntlet, a trusted entity, is reportedly preparing a proposed roll-out process that will be shared on the forum. 

Only after completing this separate governance process will fees be collected and distributed according to the adopted contracts. Koen further noted:

We’re excited to invigorate governance – incentivizing not only delegation but thoughtful and active delegation – by tying delegation to protocol fees. Specifically, we believe UNI token holders will be incentivized to choose delegates whose votes and engagement with the protocol will lead to the Protocol’s growth and success. If this proposal succeeds we believe we will see an influx of new delegations.

UNI Records 23-Month High

As these developments unfold, considerable excitement has emerged around the Uniswap protocol. Notably, a cryptocurrency investor named “Virtual Bacon” expressed enthusiasm, stating, “Uniswap finally proposes to share revenue with UNI token stakers. Chart exploding on this ‘proposal’ which hasn’t passed yet.” 

Within 24 hours, the UNI token witnessed a surge of over 52%, signaling the market’s anticipation of the potential benefits this upgrade could offer token holders.

Uniswap

Currently, the UNI token is trading at $11.29. However, with the unveiling of the upgrade proposal, the token quickly surged to the $12.50 level, reaching its highest point in 23 months. 

The gains over longer time frames have also experienced a dramatic surge. Over the past fourteen days, the UNI token has seen an impressive increase of 73%. Similarly, the token’s value has soared by 94% in the last thirty days. 

Overall, should the proposed upgrade be approved and implemented, Uniswap will reinforce its position as a leading DEX and establish a framework that empowers token holders and fosters the continued growth and success of the Uniswap protocol.

Featured image from Shutterstock, chart from TradingView.com

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Uniswap Expands Reach: Deploys v2 Protocol On Six New Chains Including Arbitrum And Polygon

Uniswap (UNI), one of the largest decentralized cryptocurrency exchanges (DEX) by trading volume, has made an important announcement regarding deploying its v2 protocol on six additional chains. 

The chains on which the v2 protocol has been deployed include Arbitrum (ARB), Polygon (MATIC), Optimism (OP), Base, Binance Smart Chain (BSC), and Avalanche (AVAX).

Uniswap Widens v2 Protocol Deployment

According to a recent post on X (formerly Twitter) by Uniswap Labs, the software product developer working on the protocol, the decision to deploy the v2 protocol on more chains is primarily driven by the desire to simplify the experience for Liquidity Providers (LPs).

While the protocol’s v3 offers advanced features tailored for active liquidity providers, the development team believes the v2 protocol offers a more “straightforward approach.” 

By default, v2 pools cover the entire price range, reducing the need for upfront decisions and minimizing the active involvement of liquidity providers. This simplification streamlines the process and makes it more accessible to a broader range of users, according to the announcement. 

Another benefit of using the v2 protocol on multiple chains, according to Uniswap Labs, is its cost efficiency. Creating pools on v2 is more gas efficient than other versions, resulting in lower gas costs to add liquidity. 

This cost reduction can be translated into savings for users, making swaps on the platform “incredibly affordable.” In addition, the use of v2 on Layer 2 scaling solutions significantly reduces the risk of frontrunning and manipulative practices known as Miner Extractable Value (MEV). 

Ultimately, by offering an official v2 deployment directly accessible through the Uniswap interface, the developers suggest that users can be assured of a safe and secure environment for their swaps.

UNI Price Dip, Platform Metrics Remain Solid

Despite the recent developments that could attract investors’ attention and drive broader adoption of the Uniswap protocol, the exchange’s native token, UNI, is currently undergoing a significant correction in line with the overall market trend.

Currently, UNI is trading at $7.22, representing a 4.4% price drop in the past 24 hours and a 1.1% decline in the last trading hour. However, it’s worth noting that UNI has been one of the better-performing tokens in the market, with price increases of 14.7% and 16.8% in the past fourteen and thirty days, respectively.

Uniswap

Furthermore, according to data from Token Terminal, the Uniswap ecosystem continues to exhibit substantial growth in key metrics. 

The fully diluted market capitalization of Uniswap stands at $7.56 billion, reflecting the total value of all tokens if they were fully in circulation. This figure has experienced a notable increase of 18.4% over the past month. 

In contrast, the circulating market capitalization, which considers the currently circulating tokens, is valued at $6.94 billion, indicating a 19.9% increase over the same period.

Uniswap

Despite the overall surge in market capitalization, the trading volume of the UNI token has experienced a significant decline of 69.3% over the past 30 days, amounting to $2.79 billion. 

The total value locked (TVL), a measure of the value of assets locked within Uniswap’s smart contracts, has also experienced a 14.4% increase, reaching $4.76 billion. 

Featured image from Shutterstock, chart from TradingView.com 

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Uniswap V4 Expected To Be Huge, But Is This Requirement A Dealbreaker?

Due to its innovation, Uniswap Labs plans to introduce Hooks in the upcoming Uniswap v4, putting the world’s leading decentralized exchange in the spotlight. According to a critic on social media platform X, the DEX is on the know-your-customer (KYC)-verification route once Hooks on Uniswap v4 are released.

Uniswap Hooks and KYC| Source: "yourfriendSOMMI" on X

Uniswap v4 Hooks Is The Beginning Of Censorship?

Sharing screenshots, the user shared insights and said the exchange brings KYC verifications on the latest iteration. At the same time, the platform plans to use the “permission required” off-chain server on UniswapX for performance enhancements. 

UniswapX is an open-source solution allowing permissionless and open trading across Automated Market Makers (AMMs) and other liquidity sources. It is currently being tested on the Ethereum mainnet.

Though the community has embraced these developments, the critic said these requirements, especially the identity verification requirement on Hooks, will be available as an option before being gradually made mandatory down the line.

Uniswap v4 is being developed, and Hooks will be one of the key updates. Hooks are programmable extensions for customizing pool and trade behavior, tightly integrated with Uniswap’s core protocol. 

With Hooks, it becomes easier for developers to implement other features such as dynamic fees, on-chain limit orders, and overly improved customization. In this way, it will also be possible to integrate Uniswap v4 into other protocols.

Uniswap Evolution: Building “Real” DeFi?

The DEX has constantly evolved and released new features since the first version went live in late 2018. Uniswap v1 introduced AMM, opening up decentralized finance (DeFi). This allowed liquidity providers (LPs) to be crucial to market making. 

Uniswap price on October 16| Source: UNIUSDT on Binance, TradingView

In Uniswap v3, the exchange released concentrated liquidity (CL). This feature allows LPs to specify a price range within which they are willing to provide liquidity. In Uniswap v2, LPs provided liquidity across the entire price range of the token pair. In v3, liquidity depth increases while traders get better pricing.

Despite the criticism, Hooks has been supported in some quarters. For instance, the user acknowledged that the feature would amplify the value proposition of some protocols, making them real “DeFi” platforms. At the same time, while responding to the critic, another commentator said the feature will do more than what anybody else has done for “real DeFi.”

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Uniswap Unveils Funding Plan For Ecosystem Revamp As UNI Price Hits 4-Month Low

In a move aimed at advancing their vision of creating a self-sovereign Internet with a permissionless alternative to traditional finance (TradFi), the Uniswap Foundation (UF) has submitted a proposal to secure the second tranche of funding. 

The desired funding, totaling $62.37 million, will be put to an on-chain vote scheduled for Wednesday, October 4th, with a 10% buffer included to mitigate price volatility.

Uniswap Foundation Seeks Community Approval

The separation of the funding request into two tranches was initially established to allow the UF to finalize its legal entity and obtain non-profit status from the Internal US Revenue Service (IRS), as the company is based in Brooklyn New York, ensuring clarity on tax implications before receiving the larger portion of funds. The UF obtained this status in the spring of this year, prompting the request for the second tranche.

The first tranche of funding, approved by Uniswap governance last year, aimed for $20 million but experienced a decrease in value due to a drop in the price of UNI, the native token of the Uniswap Protocol. 

Consequently, the Uniswap Foundation received $17.3 million worth of UNI, creating a remainder of $56.7 million to be requested in the second tranche. A 10% buffer of $5.67 million has been included to account for potential price fluctuations, bringing the total request to $62.37 million.

The Uniswap Foundation plans to receive the funds in UNI, with the amount determined using a 30-day UNI/USD TWAP (Time-Weighted Average Price). The pricing and its source will be explicitly noted in the on-chain proposal to ensure transparency in the process.

Regarding future operations, Uniswap currently holds 452,534 UNI tokens for employee vesting, valued at around $1.9 million. Factoring in a capital loss of $259,000 and the current UNI price, the UF has approximately $9.24 million remaining for operational expenses, expected to sustain them until Q4 2024. 

Lastly, according to the proposal discussion, the Uniswap Foundation anticipates revisiting governance in mid-2024 to extend its operational runway.

UNI Consolidates Amid Bearish Market Sentiment

Uniswap’s native token, UNI, has been consolidated between the price range of $4.198 and $4.311 over the past week. 

This price stagnation comes from the overall market trend and a bearish macro outlook, with the token experiencing a 0.5% decline in the fourteen-day timeframe. Furthermore, UNI has dropped 9.6% over the past 30 days, reaching a four-month low.

Uniswap

In the short term, UNI bulls must defend the current price floor to establish a strong support level. They aim to surpass the resistance walls at $4.418 and $4.487 to break the downtrend structure and potentially rally toward $6.259. It is worth noting that this price level is still below UNI’s annual high of $7.629.

According to Token Terminal data, Uniswap’s circulating market cap currently stands at $3.67 billion, experiencing a recent decrease of 6.66%. The fully diluted market cap, which considers the total number of UNI tokens that could enter circulation, stands at $4.27 billion, displaying an 8.15% decrease.

The total value locked (TVL) in Uniswap, representing the amount of cryptocurrency assets deposited and utilized within the platform, has recently declined by 5.31%. This decline reflects the broader Decentralized Finance (DeFi) sector’s challenges.

Featured image from Shutterstock, chart from TradingView.com 

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UNI Mum as Uniswap V3 Announcement Leaves Bulls Wanting More

Key Uniswap Takeaways

  • Uniswap (UNI/USD) surged on Wednesday but lacked the momentum to turn the upside move into a price rally.
  • The move uphill appeared after the decentralized exchange unveiled a long-awaited network upgrade.
  • No hints on gas-solving layer-2 solution left bulls wanting more upside cues.

Uniswap climbed on Wednesday after the leading decentralized exchange team released details on its major upcoming protocol upgrade.

V3 Outlook

The latest published specifications showed that the “Uniswap V3” update would improve gas fee issues on the network. Uniswap consumes a majority of gas fees on the Ethereum network. Data fetched by ETH Gas Station shows that the exchanged charged $2 million worth of ETH for transactions in the past 30 days.

Uniswap’s new iteration aims to solve gas issues. However, the exchange won’t alleviate the problems until it launched its Layer 2 scaling solution, powered by a separate “Optimism” solution, which is also a part of the Uniswap v3 update.

The new revelations did not provide enough updates about when Uniswap would integrate Optimism into its protocol. But the exchange did state that it would introduce “concentrated liquidity,” a feature that would provide individual liquidity providers “granular control” over price areas for their allocated capital.

“Liquidity providers can provide liquidity with up to 4000x capital efficiency relative to Uniswap v2, earning higher returns on their capital,” the update read. “Even with these groundbreaking design improvements, the gas cost of v3 swaps on Ethereum mainnet is slightly cheaper than v2. Transactions made on the Optimism deployment will likely be significantly cheaper!”

UNI/USD Climbs Cautiously

The UNI/USD exchange rate jumped 1.48 percent to $31.47 after the Uniswap V3 announcement. Nevertheless, the pair’s volumes declined in the period of upside moves, showing a lack of bullish conviction among traders.

Uniswap, UNIUSD, UNIUSDT, UNIBTC, cryptocurrency, decentralized finance
Uniswap posts cautious gains after its v3 update. Source: UNIUSD on TradingView.com

Uniswap also faced downside pressure from its 50-4H simple moving average wave, which served as short-term resistance for the token. A break above the price ceiling posed the greater potential for UNI to reach the $35-36 price range as it attempts a full-fledged breakout out of its Ascending Triangle, a bullish continuation pattern.

Meanwhile, a failure to close above the 50-4HMA risked having Uniswap bears test the Triangle’s lower trendline for a downside breakout.