Uniswap Price Could ‘Go Parabolic’ Due To Supply | Crypto News
Uniswap (UNI) ripped increased on Tuesday after Uniswap Labs founder Hayden Adams unveiled “UNIfication,” a sweeping governance proposal that would activate protocol charges and route them into coordinated token burns. The structural shift—mixed with a sharp change in how Uniswap’s groups are organized, igniting an extraordinarily bullish sentiment, with CryptoQuant CEO Ki Young Ju arguing that a real provide shock may very well be incoming.
Uniswap (UNI) Supply Shock Incoming?
“Uniswap could go parabolic if the fee switch is activated. Even just counting v2 and v3, with $1T in YTD volume, that’s about $500M in annual burns if volume holds. Exchanges hold $830M, so even with unlocks, a supply shock seems inevitable. Correct me if I’m wrong,” Ki Young Ju wrote.
In a thread posted early Tuesday, Adams said he was “incredibly excited to make my first proposal to Uniswap governance,” describing a framework that “turns on protocol fees and aligns incentives across the Uniswap ecosystem.” He framed the transfer as the fruits of years of legal wrangling that had constrained Labs’ position: “UNI launched in 2020, but for the past 5 years Labs has been unable to meaningfully participate in Uniswap governance […] That ends today,” he wrote, including that “the regulatory environment has shifted.”
The on-chain economics he outlined are unambiguous. Protocol usage would start burning UNI; Unichain sequencer income could be directed to the same burn sink; and the treasury would immediately destroy 100 million UNI to account for charges that “could have been burned if fees were turned on at token launch.”
Adams also described new “protocol fee discount auctions” to improve LP outcomes and internalize MEV, and an “aggregator hooks” structure in v4 that would let the protocol seize charges sourced from exterior liquidity.
In parallel, Uniswap Labs would stop charging charges on its interface, pockets, and API to push distribution and adoption, while Uniswap Foundation workers transfer to Labs under a growth mandate funded by the treasury. The internet impact is a consolidation: Uniswap’s development, growth and price coverage could be operated under a single, explicitly token-aligned construction, with governance retaining control.
Price motion mirrored Ki Young Ju’s remark. UNI spiked to multi-week highs as coverage unfold. In early European trading hours, UNI confirmed a one-day gain close to 30% while many majors treaded water, underscoring UNI’s idiosyncratic governance-driven rally.
Beyond headline burns, the crux is whether or not the financial flywheel could be sustained without degrading liquidity supplier economics. Historically, Uniswap governance has wrestled with “fee switch” design trade-offs and the risk of disintermediating LPs or pushing order circulation elsewhere.
Adams argued this blueprint is different because price proceeds usually are not distributed as passive yield but are instead destroyed to focus worth into the remaining float, while low cost auctions and MEV internalization are meant to keep LPs aggressive on internet execution. The full rationale and parameterization—price charges, cut up between swimming pools, cadence for auctions, and the precise mechanics of the burn—are laid out in the governance post now in “Requests for Comment,” with implementation subject to the same old discussion board review and on-chain governance course of.
Adams forged the proposal as an existential scaling step: “I believe Uniswap protocol can be the primary place tokens are traded. This proposal sets the stage for the next decade of its growth […] Uniswap will ship relentlessly over the coming years and supercharge the ecosystem of developers, LPs, and traders,” he wrote.
According to estimates by MegaETH Labs member BREAD, if Uniswap had been to modify its customary 0.3% trading price so that 0.25% is allotted to liquidity suppliers and 0.05% directed toward UNI buybacks, the protocol may channel roughly $38 million into month-to-month repurchases. This projection is based on an annualized price income of roughly $2.8 billion and would place Uniswap’s buyback capability barely above PUMP’s $35 million tempo, yet still below HYPE’s $95 million benchmark.
At press time, UNI traded at $8.609.
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