The world’s largest so-called decentralized exchange, Uniswap, has introduced a 0.15% fee on its most popular trading pairs – a move that will not benefit UNI token holders. Incredibly, Hayden Adams, the founder of Uniswap Labs, claims that this new fee is separate from the Uniswap Protocol’s fee switching feature, which is operated by UNI token holders.
Aggravating UNI holders with this decision continues a long history of ignoring Uniswap’s peculiar coin offering.
Indeed, UNI’s price is down 91% from its all-time high. Even worse, Uniswap operated for two years without the need for a governance token. Coinciding with a generous allocation to Adams and a group of early insiders, Uniswap strangely pegged its UNI token to its otherwise well-functioning ecosystem on September 16, 2020.
With a total value of $3 billion (TVL) and a #1 position on the DEX volume rankings, Uniswap.org is by far the most popular digital asset trading website in the world in a non-custodial manner. It has processed trillions of dollars in transactions since its inception.
How Uniswap’s voting system unfairly favors the wealthiest token holders
Uniswap charges an additional 0.15% on website and wallet
The new fee affects trading pairs that include two of the following tokens: ETH, USDC, WETH, USDT, DAI, WBTC, agEUR, GUSD, LUSD, EUROC and XSGD.
For swaps between stablecoins or between ether and wrapped ether, the additional costs will not be charged. Additionally, a Uniswap spokesperson told CoinDesk that she “just wanted to clarify that both input and output tokens must be listed for the fee to apply (not just on one side).”
Regardless, Adams’ new 0.15% fee only affects users of Uniswap’s website and wallet (API and other users on the chain can avoid this). Developers say the new fee will help fund the protocol sustainably.
He also boasted that the 0.15% fee is among the lowest for digital asset exchanges and should not reduce accessibility to Uniswap, assuring UNI holders that the fee will fund future Uniswap-related development.
Of course, the proceeds from the UNI token sale were supposed to fund the Uniswap-related development. People who bought that token and voted with it, despite their years of contributions, will not benefit from Adams’ new 0.15% rate.
I work in crypto because of the tremendous positive impact I believe it can have on the world, removing gatekeepers and increasing access to value and ownership.
I’m proud of the ways @Uniswap Labs has contributed to that effort and want to ensure we have sustainable…
— hayden.eth 🦄 (@haydenzadams) October 16, 2023
More money for the team, not for UNI holders
There was a lot of criticism of Uniswap’s new UNI-exclusive rate, with several frustrated users responding directly to Adams’ announcement.
I’m not sure I see the value for the users or the holders.
Sounds like a new tax to me. How to get more money from the users to the team.
— Crypto JAW (@jaw_crypto) October 16, 2023
Adam Cochran joked that UNI has become as neglected as Uniswap has essentially relegated it to a meme coin: UNI in name only.
After today, can we get CoinGecko to move $UNI to the Memecoin section?
— Adam Cochran (adamscochran.eth) (@adamscochran) October 17, 2023
A long history of ignoring UNI holders
The Uniswap team has previously shown little attention to the results of the UNI board votes. For example, it took a long time to implement a fee change protocol, which was adopted by a supermajority in each voting round. After inexplicable delays, it eventually blamed regulators.
Remember the proposal for a move to a uniswap fee?
it passed the discussion, the temperature check, the consensus check with a 100% advantage, and then… crickets.
the community got fucked again lmao
— banteg (@bantg) August 15, 2022
Uniswap once ignored a “governance” vote that passed with 100% approval.
Read more: Uniswap founder criticized for asking developers to contribute to DeFi protocol update
It doesn’t help that the voting system favors parties that can afford to acquire millions in UNI tokens, even temporarily. Binance of course denied using UNI customers’ holdings to vote on proposals, even though the company likely benefited from a vote to launch Uniswap on BNB Chain.
While the Uniswap team will likely benefit from the new 0.15% fee on some trading pairs, UNI token holders will see no benefits. As usual, Uniswap made a unilateral decision without first asking the holders of the governance tokens.