The Uniswap community has recently dismissed a governance proposal aimed at altering the platform’s fee structure, which included the provision for distributing revenue to UNI token holders.
The voting period for this proposal concluded on March 9, revealing that 59.9% of mobilized UNI votes stood in opposition.
The proposal, now rejected, sought to empower the decentralized autonomous organization (DAO) with the capability to amend Uniswap’s fee structure, paving the way for the activation of the much-anticipated Uniswap “fee-switch.”
This proposed mechanism would have facilitated the distribution of protocol revenue among UNI token holders.
Interestingly, just two days prior to the rejection of this proposal, another distinct proposal aimed at enabling the collection of protocol revenue had passed with near-unanimous support.
UNI token holders are anticipating the implementation of a fee-switch feature.
The activation of a fee-switch feature within Uniswap has long been a coveted objective, stemming from the distribution of UNI tokens to early adopters back in 2020. GFX Labs, a prominent DeFi-focused research and development firm, stands as a key player in this endeavor, having co-authored the latest fee switch proposal. Interestingly, this isn’t their first foray into proposing such a mechanism, as a similar initiative was tabled by them the previous year.
Their initial proposal suggested a distribution of either 10% or 20% of Uniswap revenue derived from pool fees to token holders. However, it encountered resistance within the community. The vote revealed a split sentiment, with 45.3% opposing the proposal, while 42.3% supported a 20% fee distribution and 12.3% favored a 10% distribution. Despite the proposal’s failure to gain traction, it underscored a prevailing sentiment within the community favoring some form of fee switch activation.
Central to the resistance against the proposal was apprehension regarding potential tax and legal ramifications for the Uniswap protocol and its core team stemming from fee distributions. This concern amplified when influential entities within Uniswap governance, such as a16z and Hayden, expressed hesitancy towards activating the fee switch, citing fears of creating legal liabilities.
The discourse surrounding the recent proposal also brought to the forefront worries surrounding security and technical risks associated with granting the Uniswap DAO the authority to modify the underlying code of the fee mechanism. Critics voiced concerns that introducing upgradability in contracts could introduce vulnerabilities, potentially compromising the system’s stability and integrity. These deliberations underscore the nuanced considerations at play within the Uniswap community as they navigate the complexities of governance and protocol evolution.
Uniswap launches a browser extension.
In the preceding month, Uniswap unveiled a browser sidebar extension, accompanied by a limit order placement feature and additional tools aimed at enhancing cryptocurrency transactions.
With the introduction of the Uniswap Extension, users gain access to a novel method of engaging with digital assets directly from their browser sidebar. This integration aims to simplify the process of swapping digital assets, signing transactions, and executing trades seamlessly.
Uniswap articulated their motivation behind this innovation on social media, stating, “Let’s face it — most wallet extensions are mired in outdated UX paradigms and cumbersome onboarding processes. That’s precisely why we developed our own.”
With Uniswap Extension you’ll be able to swap, sign transactions, and send or receive crypto anywhere on the web
Everything is right there in your sidebar — exactly where you need it to be
It's like ✨magic✨ pic.twitter.com/G5WoO60osF
— Uniswap Labs 🦄 (@Uniswap) February 27, 2024
Additionally, the update incorporated a Limit Orders functionality, enabling users to automate the purchase or sale of cryptocurrencies at predetermined prices.
Meanwhile, UNI is presently trading at $14.30, showing minimal fluctuation over the preceding day. However, data sourced from CoinMarketCap reveals that the token has surged by over 14% throughout the week and an impressive 115% over the last month.
